The CBO Uses them in its projections
According to recent reports and economic analyses, tariffs imposed in 2025 are projected to reduce the U.S. federal budget deficit by increasing government revenue from import duties. However, economists note that this effect is complex and is accompanied by higher prices for consumers, a contraction of the overall economy, and limited impact on the trade deficit.
Impact on the federal budget deficit
- Reduced deficit projection: The Congressional Budget Office (CBO) projected in August 2025 that new tariff revenue, if maintained, would decrease the U.S. federal budget deficit by $4 trillion over the next decade. This includes approximately $3.3 trillion in direct revenue and an additional $700 billion in reduced interest spending due to less federal borrowing.