Former President Trump’s proposal to replace some of the United States’ income taxes with higher tariffs on imports to compensate for lost revenue has been criticized by Treasury Secretary Janet Yellen.
During a recent meeting with Republican lawmakers on Capitol Hill, the former president shared his idea. In a conversation with Jonathan Karl on ABC’s “This Week,” Janet Yellen was asked if she thought Trump’s proposal would have any feasibility.
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According to Yellen, imposing tariffs exceeding 100% would be necessary.
She continued by stating that if implemented, it would render the lives of working-class Americans unaffordable, as well as harm American businesses.
The focus of Trump’s economic strategy, according to his campaign, is on domestic manufacturing, with his tariff being a critical component.
Analysts from various political affiliations are raising concerns over Trump’s recent tariff policy proposal. The Center for American Progress, a liberal Washington-based think tank, has conducted an analysis that suggests the policy could lead to a cost of approximately $1,500 per year for the average American.
According to the study, similar to Yellen’s opinion, the imposition of tariffs would have a greater negative impact on American consumers and importers rather than on foreign rivals such as China.
To illustrate, if there is a tax imposed on imports, it would result in an extra $90 annually for food, $120 for oil, $220 for automobiles, $70 for clothes, $80 for electronics and $50 for furniture and appliances.
In fiscal 2024, tariffs contribute a mere 1.7 percent to the overall federal income of the United States.
As they campaign across America ahead of this fall’s election, both President Biden and Trump have emphasized the importance of domestic manufacturing in their economic agendas.
When Karl questioned Yellen about why Americans are feeling frustrated with prices despite the slowdown in inflation, she took the opportunity to defend the Biden administration and its economic policies.
According to her, addressing this matter is of utmost importance to the Biden administration.
