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The tariff hikes approved by President Trump have infuriated Beijing and escalated the U.S.-China trade war, but there has been at least one beneficiary: the U.S. Treasury. As of June 30, the U.S. government has collected $63 billion in tariffs over the preceding 12 months, according to the latest Treasury data. What’s more, the tariff bounty is on the rise.
The U.S. collected $6 billion in tariffs in June, up from $5.3 billion in May and $4.8 billion in April, after Mr. Trump’s decision to raise levies on $200 billion in Chinese goods from 10% to 25%. The latter took effect gradually beginning in May, based on when goods left port in China.
The U.S. is now on a pace to generate $72 billion in tariffs annually, and could well hit the $100 billion mark Mr. Trump has touted if new 10% tariffs on $300 billion in untaxed imports take effect on Sept. 1, as threatened.
There is one caveat, however. For every dollar brought in by the new tariffs, a dollar has been authorized to fund rescue programs for farmers who have been harmed by retaliation from China and other countries. The U.S. authorized $12 billion in farm rescue funds in 2018 and an additional $16 billion this year, for a total of $28 billion.
In June, more than $3 billion of the monthly tariff revenue, over half of the total, came from China alone—the first time that has happened, according to the Tariffs Hurt the Heartland analysis. The Treasury publishes figures on overall revenue, and by tabulating detailed Commerce Department data, the group identified how much was raised by each of the different tariffs.
The policy harms China by making its goods more expensive, but business groups are quick to point out that it is U.S. importers who must pay tariffs, rather than China itself. “Americans are already paying record-high tariffs, and the biggest hit to consumers is still to come on Sept. 1,” said Jonathan Gold, a spokesman for Tariffs Hurt the Heartland. “We continue to urge the administration to change course.”
A number of factors, however, could keep customs revenue from reaching the $100 billion-a-year level projected by Mr. Trump. First, as the trade war with China has intensified, U.S. trade with China has declined. China, once the U.S.’s largest trading partner, has fallen behind Mexico and Canada so far this year. If that trend continues, there will be a lower volume of imports on which to assess the tariffs.