"In the most recent Outlook, we projected that changes in trade policy since January 2025 would temporarily raise the rate of inflation, reduce real investment, lower the level of real gross domestic product (GDP), and reduce employment. The termination of IEEPA tariffs dampens those effects."
"Overwhelming research has indicated tariff revenue has come not from exporters, but rather U.S. importers, and by extension, American businesses and consumers shouldering increased costs. The Federal Reserve Bank of New York found Americans paid for up to 90% of the import taxes."
The Supreme Court's decision to invalidate the majority of President Trump's tariffs under the International Emergency Economic Powers Act removes an estimated $300 billion in annual tariff revenue. While this represents a significant loss for the administration's fiscal plans, it provides relief to American consumers and businesses struggling with elevated import costs. The Congressional Budget Office projects the tariff termination will increase the deficit by $2 trillion from 2026 to 2036, comprising $1.6 trillion in primary deficits and $400 billion in interest costs. Despite losing revenue that could have addressed the $39 trillion national debt or funded tax rebates, lower tariffs are expected to reduce inflation, increase investment, boost GDP growth, and improve employment. Research confirms American importers and consumers bore approximately 90% of tariff costs.
#supreme-court-tariff-ruling #trade-policy-economic-impact #federal-deficit-projections #consumer-pricing-relief
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