Tariffs are a Weak Revenue Source and can Hardly Dent $39-T U.S. Debt

For President Donald Trump, tariffs — not just the idea but also the emotional response — make up what he once called “the most beautiful word” in the English language.

 Trump's tariff strategy failed to tackle the deficit.

For him, the beauty of tariffs lies in their supposed ability to solve the country’s biggest financial problems, serving as both a replacement for income tax and a fix for the nation’s towering federal deficit, Jake Angelo reported for Fortune.

Yet that cure may be more illusion than solution, as experts say tariffs are a faulty revenue-making device.

“As a revenue tool, they’re very weak,” Kyle Pomerleau, an international tax policy expert and senior fellow at the American Enterprise Institute (AEI), told Fortune.

“They do raise some revenue, but just not enough to really move the needle one way or the other.”

Trump has touted tariffs as a viable tool for tackling the national debt. But with the debt on track to hit a record $39 trillion, the revenue coming in from tariffs today barely scratches the surface.

Treasury Secretary Scott Bessent said the Trump administration ultimately aims to fully replace the revenue lost from the International Emergency Economic Powers Act (IEEPA) tariffs that the Supreme Court struck down last month.

However, both the new 10% tariffs introduced under Section 122 — which allows the president to impose tariffs on a short-term basis — and the previous IEEPA levies fall short of making a meaningful dent in the federal deficit.

Trump said last year that tariffs “are helping to slash the deficit this year by more than 25%.” But with a tariff strategy that failed to tackle the deficit then and is more hamstrung now, that claim is far from reality.