Trump seeks to close $1.6 trillion revenue gap with raft of new tariffs :: WRAL.com

WASHINGTON (AP) — The Trump administration this week stepped up its ambitious effort to replace about $1.6 trillion in lost tariff revenue that was eliminated by the Supreme Court’s decision to strike down a range of the president’s import taxes.

Recovering that lost revenue, which the White House was counting on to help offset the steep, multi-trillion dollar cost of its tax cuts, is possible but will be challenging, experts say. The administration has to use different legal provisions to impose new duties, and those provisions require longer, complex processes that U.S. companies can use to seek exemptions. It could be months or more before it is clear how much revenue the replacement tariffs will yield.

“I wouldn’t bet against this administration being able to get back on paper the same effective tariff rate they had before,” said Elena Patel, co-director of the Urban-Brookings Tax Policy Center. But the new approach will “make it easier for people to contest the tariffs, which is going to put a big asterisk on the revenue until all that is settled.”

On Wednesday, U.S. Trade Representative Jamieson Greer said the administration will investigate 16 economies — including the European Union — over whether their governments are subsidizing excessive factory capacity in a way that disadvantages U.S. manufacturing. The investigation will also cover China, South Korea, and Japan, Greer said.

In addition, he said there would be a second investigation of dozens of countries to see if their failure to ban goods made by forced labor amounts to an unfair trade practice that harms the United States. That investigation will also cover the EU and China, as well as Mexico, Canada, Australia, and Brazil.

Both investigations are being conducted under Section 301 of the 1974 Trade Act, which requires the administration to consult with the targeted countries, as well as hold public hearings and allow affected U.S. industries to comment. A hearing as part of the factory capacity investigation will be held May 5, while a hearing on the forced labor investigation will occur April 28.

It’s a far cry from the emergency law that President Donald Trump relied on in his first year in office, which allowed him to immediately impose tariffs on any country, at nearly any level, simply by issuing an executive order.

Moments after the Supreme Court’s ruling, Trump imposed a 10% tariff on all imports under a separate legal authority, but that duty can only last for 150 days. The president has said he would raise it to 15%, the maximum allowed, but has yet to do so. Some two dozen states have already challenged the new tariffs. The administration is aiming to complete its Section 301 investigations before the 10% duties expire.

The effort underscores the importance that the Trump White House has placed on tariffs as a revenue-raiser at a time when the federal government is facing huge annual budget deficits for decades into the future. Previous administrations, by contrast, used tariffs more sparingly to narrowly protect specific industries.

Erica York, vice president of federal tax policy at the Tax Foundation, noted that the first investigation covers roughly 70% of imports, while the second would cover nearly all of them.

“That breadth suggests the goal isn’t to address the issues at hand, but instead to recreate a sweeping tariff tool,” she said.

Trump sees tariffs as a way to force foreign countries to essentially help pay the cost of U.S. government services, even though all recent economic studies find that American companies and consumers are paying the duties, including ones from the Federal Reserve Bank of New York and economists at Harvard University. In his state of the union address last month, Trump even touted his tariffs as a potential replacement for the income tax, which would return the United States’ tax regime to the late 19th century.

Trump also wants tariffs to help pay for the tax cuts he extended in key legislation last year. The tax cut legislation is expected, according to the most recent estimates by the nonpartisan Congressional Budget Office, to add $4.7 trillion to the national debt over a decade, while all Trump’s duties, including ones not struck down by the court, were projected to offset about $3 trillion — or two-thirds of that cost.

The court’s ruling Feb. 20 that he could no longer impose emergency tariffs eliminated about $1.6 trillion in expected revenue over the next decade, according to the CBO.

Some of Trump’s tariffs remain place, including previous duties on China and Canada that were imposed after earlier 301 investigations. The administration has also slapped tariffs on some specific products, including steel, lumber, and cars. Those, combined with the 10% tariff for part of this year, should yield about $668 billion over the next decade, the Tax Foundation estimates.

“It’s going to take a really big patchwork of these other investigations to make up for the (lost) tariffs,” York said.

The administration’s efforts are also unusual because they reflect an overreliance on tariffs to bring in more government revenue. Trump has also said the duties are intended to return manufacturing to the United States, and he has used them to leverage trade deals.

“What makes this really different,” said Kent Smetters, executive director of the Penn Wharton Budget Model, “it is really the first time tariffs have been mainly used as a revenue raiser.”

Patel, meanwhile, argues that raising revenue can be done more reliably and straightforwardly by Congress. Laws like Section 301 are traditionally intended to be used to address specific trade policy concerns in particular countries.

“It’s not supposed to be there to raise revenue,” she said. “If we want to raise revenue through tariffs, then Congress should impose a broad based tariff.”

Visited 1 times, 1 visit(s) today

Related Article

SHOP Stock Sell-Off Looks Overdone as Margins and Guidance Shine

Shopify’s NASDAQ: SHOP stock sold off following its Q3 earnings release on fears that may be overblown given the company’s fundamental strength. Ultimately, it comes down to valuation: the approximately 80x current-year consensus earnings multiple it traded at before the release was high, pricing in perfection and leaving little room for weakness. The roughly 1%

New York City police officers are on duty outside the Lotte Palace Hotel during a United Nations General Assembly leaders reception, late Tuesday, Sept. 22, 2026, in New York. (AP Photo/Julia Demaree Nikhinson)

International Politicians React to Democrats Winning US Midterms

Nov 4 (Reuters) – Governments and politicians around the world reacted to the Democrats winning the US midterm elections, a result that could have major implications for global ⁠trade, ⁠security and energy prices.  Here is a selection of the reactions: SPANISH PRIME MINISTER PEDRO SANCHEZ ON ⁠X “Yesterday, the American people voted against policies that

The Smartest Dividend Stock to Buy With $1,000 Right Now

The market has been down over the past month as investors consider higher interest rates, inflation, and artificial intelligence (AI) spending, and now is a good time to think about defensive plays like dividend stocks. Also, $1,000 is enough to start a position in an excellent dividend stock that should pay you well forever. You

“Iran was a piece of it,” the president said in a WSJ interview, adding that he didn’t regret launching the war.

Trump acknowledges Iran war is partly to blame for Republican losses

WASHINGTON—President Trump said on Tuesday night that the war in Iran was partially to blame for widespread Republican losses in the midterm elections. But he maintained that he didn’t regret launching the war earlier this year. “Iran was a piece of it,” the president said in a WSJ interview, adding that he didn’t regret launching

‘We are a threat to Putin’: the small Norwegian news outlet with half its staff on Russia’s wanted list | Norway

‘We are a threat to Putin’: the small Norwegian news outlet with half its staff on Russia’s wanted list | Norway

The official newspaper of the Russian government is an unlikely source of recognition for a European news outlet critical of Vladimir Putin and providing sanctuary to exiled Russian journalists. But in May, two days after Russia tested its new intercontinental ballistic missile system nicknamed “Satan II” by Nato, an article in Rossiyskaya Gazeta prompted celebrations

An analysis by The Economist suggests that tenants are increasingly missing payments and turning to costly short-term credit, even as homeowners’ finances remain resilient.

America’s renters are in serious trouble

Jacob ramirez, a 31-year-old operations manager for a café chain, has long struggled to make ends meet. In college he used a credit card to buy textbooks; after graduating, he occasionally did so to pay rent and utility bills. By 2022 he, his wife and their dog were in a one-bedroom flat in Pomona, east

US stock futures fall amid key Democratic midterm election wins

Robert Wolf, a former economic advisor to Obama, and Steve Cortes, a former Trump campaign advisor, discuss the midterm election’s impact on Wall Street. U.S. stock futures fell sharply as Democrats scored key victories in the midterm elections and the Fox News Decision Desk projected the party will take control of both chambers of Congress.

Why Capri Holdings Stock Popped 32% in October

Shares of Capri Holdings (NYSE:CPRI) were on the move last month, jumping at the end of the month on a strong earnings report after earlier gains on speculation of a buyout. Capri also seemed to benefit from a rotation in consumer discretionary stocks as investors sold AI stocks last month. Missed Nvidia in 2009? This

Democratic supporters cheer as midterm voting results are announced at a phone bank and watch party Tuesday.

Five takeaways from democrats’ stunning midterm blowout

WASHINGTON—Voters delivered an astonishing rebuke to President Trump and his party on Tuesday, stripping Republicans of congressional control amid widespread frustrations with the economy and elevating a new class of Democratic lawmakers to power. Democratic supporters cheer as midterm voting results are announced at a phone bank and watch party Tuesday. The backlash was more

Last month Aramco pushed around 7m barrels of oil a day to the market, up from 4.5m in July and roughly equal to the figure in February, before the war (AFP)

Besieged by war, Saudi Aramco continues to gush profits

SAUDI ARAMCO, the world’s biggest oil company, has proved remarkably resilient this year. Since war broke out with Iran it has faced attacks on its facilities and disruption to the Strait of Hormuz, through which most of its barrels were shipped. Yet its cash gushers continue to flow. On November 3rd it reported an adjusted

Tourism Ireland leads major drive for 2027 at world’s largest travel fair

Tourism Marketing Tourism Ireland leads major drive for 2027 at world’s largest travel fair Around 3,600 meetings at World Travel Market in London set to deliver overseas tourism business worth millions of euro &nbspTues 3rd November 2026 Pictured: Biddy Hughes, Westport Estate; Julie Wakley, Tourism Ireland; and Karina Dunne, EPIC The Irish Emigration Museum, at

Andy Burnham to agree new cheaper travel and pets rules with EU

It will end the need for expensive certificates Neil Shaw Assistant Editor 06:17, 04 Nov 2026 It will be the first new deal of its kind since Brexit Pet owners are likely to get easier access to the European Union for their animals for the first time since Brexit under a deal Prime Minister Andy

Indonesia regulator announces sanctions for alleged stock market violations

End-of-day quote 2026-11-03 5-day change 1st Jan Change 324.00 IDR -2.41% -3.57% -51.28% Published on 11/03/2026 at 11:16 pm EST Reuters This article is reserved for our members. Log in to continue Log inCreate an account 11:16pm Indonesia regulator announces sanctions for alleged stock market violations RE Oct. 29 PT Panorama Sentrawisata Tbk Reports Earnings

Local councillor Jo Bird (right) with residents and business owners in New Ferry

Why the Local Democracy Reporting Service is more important than ever

At the Liverpool ECHO, three reporters cover four of the six local authority areas across Merseyside, holding leaders to account and making a difference to communities Local councillor Jo Bird (right) with residents and business owners in New Ferry(Image: LDRS) Local Democracy Reporters (LDRs) are highlighting their work holding power to account in communities in

Matamoros, Mexico, shelter-in-place order lifted but warning for Americans remains

NEWYou can now listen to Fox News articles! U.S. officials have lifted a shelter-in-place order for government employees in a Mexican border city, but Americans are still being urged not to travel to the area. The order applied to U.S. government employees in Matamoros, a Mexican city across the border from Brownsville, Texas. The U.S.

Why Shake Shack Stock Jumped 20% in October

Shake Shack (NYSE:SHAK) stock was moving higher last month in a broader rotation into restaurant stocks as investors sold AI stocks and rotated into undervalued sectors like restaurants. There was no major news item that drove the stock up last month, but Shake Shack did benefit from its announcement that it would expand into Brazil,

Americans Urged To Avoid Mexico’s Tamaulipas Despite Eased Shelter Orders

American travelers are being urged to steer clear of Mexico’s border state of Tamaulipas, which remains under the highest United States “Do Not Travel” warning, even as recent shelter-in-place alerts in other parts of the country have been lifted following a wave of cartel-related unrest. Get the latest news straight to your inbox! Level 4

0
Would love your thoughts, please comment.x
()
x