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2d ago

Trump Renews Tariff-Funded Refunds Promise, Says Income Tax Could Disappear

Independent data show tariff receipts fall far short of income‑tax revenue, raising doubts about plans to fund rebates or eliminate the tax.

This photograph taken on May 21, 2025 shows yachts docked at the Monte Carlo harbour next to the Circuit de Monaco, four days ahead of the Formula One Monaco Grand Prix. (Photo by Andrej ISAKOVIC / AFP) (Photo by ANDREJ ISAKOVIC/AFP via Getty Images)
President Donald Trump listens during a Cabinet meeting at the White House, Tuesday, Dec. 2, 2025, in Washington. (AP Photo/Julia Demaree Nikhinson)
While Trump has often made claims of $2,000 checks, the precise structure of the process and timeline remains unclear.
U.S. President Donald Trump attends a meeting of his Cabinet in the Cabinet Room of the White House on December 02, 2025 in Washington, DC.

Overview

  • At a Cabinet meeting, President Trump said tariff proceeds would finance dividend-style refunds in 2026 and suggested Americans may eventually pay no federal income tax.
  • Treasury figures show customs duties were about $195 billion in fiscal 2025 versus roughly $2.66 trillion from individual income taxes, with the Bipartisan Policy Center estimating $258.1 billion in tariffs collected so far this year.
  • The Committee for a Responsible Federal Budget estimates $2,000-per-person dividends would cost about $600 billion per round and could add $6 trillion to deficits over a decade if paid annually.
  • Fortune reported the CBO recently cut its 10‑year deficit reduction estimate from the tariff program to $3 trillion from $4 trillion, reflecting new data and policy changes.
  • Treasury Secretary Scott Bessent has said legislation would be needed to deliver any tariff rebates, as lawsuits from companies including Costco and a pending Supreme Court case threaten parts of the tariff program.