Last updated on May 25th, 2024 at 07:50 pm
A new study found that Donald Trump’s economic plan would raise taxes on poor and middle-class Americans by $1,700 a person each year.
A study of Trump’s tariff plan by the Peterson Institute For International Economics found:
Presidential candidate Donald Trump is proposing to reduce US reliance on income taxes while increasing our reliance on import tariffs. He proposes extending expiring tax cuts from 2017 and has also suggested possible new rounds of tax cuts. At the same time, he has proposed a ten percent “across- the -board” tariff and a 60 percent or more tariff on imports from China.
Together, these policy steps would amount to regressive tax cuts, only partially paid for by regressive tax increases. The tariffs would reduce after-tax incomes by 3.5 percent for those in the bottom half of the income distribution and cost a typical household in the middle of the income distribution about $1,700 in increased taxes each year. If executed, these steps would increase the distortions and burdens created by the rounds of tariffs levied during the first Trump administration (and sustained during the Biden administration), while inflicting massive collateral damage on the US economy.
Trump consistently claims that his tariff plan would not harm the economy because he distorts the way that tariffs work. Trump claims that the nation who is the tariff is imposed upon bears the cost, when the reality is that tariffs increase prices for American consumers.
If Trump won the election and implemented his tariff plan, it would increase the tax burden on poor and middle-class families. The ten percent tax would not be paid by China but by American consumers. At a time when inflation is a lingering issue, Trump has put forward a plan that would send the US economy spiraling into a recession.
Someone has to pay for Trump’s planned massive tax cut for the wealthy, and it is going to be the poor and middle class who will get stuck with the bill.
