US President-elect Donald Trump said on Tuesday he will create a new government agency called the Foreign Revenue Service “to collect tariffs, taxes and all revenues” from foreign sources, as he prepares new import tariffs ahead of his inauguration next week.
Trump said in a social media post that he will create the department on January 20, the day he is sworn in as president for a second term, adding that Americans have been taxed for too long by the Internal Revenue Service (IRS). in English).
“Through lenient and pathetically weak trade agreements, the American economy has delivered growth and prosperity to the world while taxing ourselves. It’s time to change that,” said the Republican in a post on the Truth Social platform.
“We will start charging those who make money with us from trade, and they will FINALLY start paying their fair share,” he added.
A spokesperson for Trump’s transition team could not be reached at first to clarify Trump’s statement or explain how the new agency will work.
Trump did not specify whether the new agency would replace the collection of tariffs, taxes, fees and fines by U.S. Customs and Border Protection or the collection of taxes on foreign individual and corporate income by the IRS.
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It was also unclear whether the move would create more government bureaucracy, which could run counter to plans by Trump’s informal Department of Government Efficiency, led by billionaire Elon Musk and former biotech executive Vivek Ramaswamy, aimed at finding trillions of dollars. dollars in budget savings through streamlining government operations.
During his presidential campaign, Trump often considered replacing U.S. income taxes with tariff revenue, but the numbers don’t add up, according to economists and private analysts.
The conservative-leaning Tax Foundation estimates that a universal 20% tariff on all imports into the US would generate $4.5 trillion over 10 years, before negative economic effects that would reduce net revenue to $3.3 trillion dollars in a decade. This compares to the IRS collecting taxes of 16 trillion to 18 trillion dollars every year.
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Senator Ron Wyden, the top Democrat on the Senate Finance Committee, criticized Trump’s proposal.
“No amount of silly rebranding will hide the fact that Trump is planning a multitrillion-dollar tax increase on American families and small businesses to pay for another round of tax benefits for the wealthy,” Wyden said.
Trump has proposed a 10% tariff on global imports, a punitive 25% tariff on imports from Canada and Mexico until they crack down on drugs and immigrants crossing U.S. borders, and a 60% tariff on Chinese goods.
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Trade experts say tariffs would alter trade flows, increase costs and provoke retaliation against U.S. exports.
