U.S. Tariff Revenue Surges 60% in April, but Actual Impact Limited by Economic Slowdown

Tariff Revenue Expected to Rise Further Next Month with General Tariffs
Insufficient to Cover Federal Fiscal Deficit
Some Argue Revenue Effect Remains Limited

Following the implementation of tariffs by U.S. President Donald Trump, U.S. tariff revenue has increased significantly. However, there are opinions that the actual revenue effect will be limited due to consumer price increases and economic contraction resulting from the tariff hikes.

According to data released by the U.S. Department of the Treasury on the 23rd (local time), Bloomberg News reported that tariff revenue in April increased by more than 60% from the previous month, reaching at least $15 billion (approximately 21.4 trillion won). This reflects tariffs paid by major importers and brokers on goods that arrived at U.S. ports last month. About two-thirds of importers pay the tariffs for a given month by the 15th of the following month.

This increase in tariff revenue is mainly attributed to the 25% tariff on steel and aluminum imposed by President Trump starting on the 12th of last month.

Bloomberg projected that next month's collections will increase even further, noting that the 10% general tariff that took effect on the 2nd of this month has not yet been included.

If tariff and other excise tax revenues exceed $15.4 billion per month, it would be the highest level ever recorded in dollar terms. However, contrary to expectations that tariffs would significantly help eliminate the U.S. trade deficit, the amount is far from sufficient to cover the U.S. federal government's fiscal deficit. In the first six months of the current fiscal year, the U.S. federal government’s fiscal deficit increased by 15% year-on-year to $1.31 trillion.

The Trump administration previously estimated annual revenue from tariffs at between $600 billion and $1 trillion (about 1,467 trillion won), claiming that revenue over ten years would reach at least $6 trillion (about 8,800 trillion won).

However, there are opinions that the actual revenue effect will be limited due to consumer price increases and economic contraction. Yale University analyzed that tariffs could raise car prices by an average of 13.5%, resulting in an additional cost of about $6,400 (about 9.38 million won) when purchasing a new car. This suggests that consumption could contract due to price increases before the revenue effect of the tariff hikes is realized.

The Peterson Institute for International Economics also stated, "Even if a 50% high tariff is imposed on all imports, the maximum annual revenue would be about $780 billion," adding, "This does not even reach 40% of income tax revenue." Senior fellow Kimberly Clausing argued, "If product prices rise by 50%, no one will consume the same amount," and "Revenue never increases in a linear fashion."