Trump floats rebates for taxpayers amid leech of tariffs
President Donald Trump says his administration is considering rebating taxpayers. The White House says tariffs have been raked over more than $100 billion.
Last month, President Donald Trump teased that the global tariffs announced earlier this year could be accompanied by potential rebates.
“We’ve got a lot of money coming in and we’re thinking about a little rebate,” Trump said, planning on resolving details of the UK trade agreement ahead of his trip to Scotland on July 25th.
The White House announced that some of the tariffs disclosed on April 2 generated revenue of $100 billion.
Trump did not provide details of potential rebates that are unlikely to pass in Congress, except that it is available only to people at certain income levels. The president will need Congressional approval to approve the rebate.
Although the details are missing, here’s what you need to know about potential tariff rebates:
Senator Josh Hawley introduces the rebate bill
Shortly after Trump’s July comments, Missouri Republican Sen. Josh Hawley introduced the 2025 American Workers Rebate Act.
A family of four can receive up to $2,400. Under this law, credits could increase if tariff revenue exceeds the 2025 forecast.
“My law allows hardworking Americans to benefit from the wealth that Trump’s tariffs are back in this country,” Holy said in a news release announcing the bill.
U.S. Treasury Secretary Scott Bescent said tariff revenue is expected to reach $300 billion a year. But economists say the policy could increase inflation and cost taxpayers thousands of dollars a year, especially if Trump fails to reach trade deals with key partners like Canada and Mexico.
For joint filers with adjusted gross income of more than $150,000 and those applying for singles earning more than $75,000, their profits will be reduced by 5%.
The law has been introduced to the Senate Finance Committee. It must pass both the Senate and House of Representatives to become law.
What are some of the hurdles facing rebates?
Republican lawmakers are unlikely to be excited about the rise in federal spending. The stimulus check issued during the Covid-19 pandemic cost the government around $164 billion. If the check is issued, that means a significant percentage of the tariff revenue will return to taxpayers when Trump himself says his priorities are paying off $37 trillion in debt.
“What we want to do is pay off our debts,” Trump said in July. “But we’re thinking about rebates.”
In an interview with Semafor, one conservative lawmaker shot down the idea.
“People love spending money to allow new tax cuts,” Sen. Ron Johnson, a Republican from Wisconsin, told the outlet. “We’re in debt of $37 trillion and run a $2 trillion deficit a year. After a while, this madness just has to end.”
How is tax rebates different from stimulus checks?
A tax refund is a refund to the taxpayer of excess amounts paid in taxes during the year, and a stimulus check is a direct payment from the federal government to the household.
Tax rebates can be issued at any time of the year. A Hawley news release states that the tax rebate parameters are similar to the stimulus checks issued in 2020 during the economic slowdown caused by the pandemic.
When can I receive tax refunds?
The Holy bill must pass through both chambers of lawmakers until the end of the current Congress calendar. Or it should be reintroduced if it is considered dead and lawmakers want to proceed with it.
Michelle Del Rey is a trending news reporter for USA Today. Contact her at mdelrey@usatoday.com
