Thread by @TaxFoundation

President Biden could provide business and household relief by eliminating Trump tariffs: buff.ly/3oXN0v2 @ericadyork

Tariffs raise prices and reduce the quantity of goods available to U.S. businesses and consumers, which results in lower incomes, reduced employment, and lower economic output in the United States.

Using the Tax Foundation General Equilibrium Model, we estimated that the Trump administration tariffs would amount to an annual tax increase of $80 billion (the 17th largest tax increase since 1940).

If left in place permanently, all else equal, the tariffs would reduce long-term output by 0.23 percent, reduce wages by 0.15 percent, and eliminate nearly 180,000 full-time equivalent jobs.

The 0.23 percent reduction in long-run GDP is about 13.5 percent of the total long-run impact of the Tax Cuts and Jobs Act (TCJA), which we estimated would raise long-term GDP by 1.7 percent.

Also important to note is that tariffs are regressive, meaning their tax burden falls hardest on lower- and middle-income households.

🎙️ PODCAST: @ericadyork joins Tax Foundation President @scottahodge to discuss one of the most misunderstood issues in tax policy: #tariffs.

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