Monday, December 23, 2024

Americans (Mostly) Like Trump’s Idea Of Replacing Income Tax With Tariffs

Soon-to-be President Donald Trump has proposed replacing the U. S. income tax with tariffs. This proposal has received criticism from Democrats and economists but seems to be popular among average Americans. A recent I&I/TIPP Poll showed that 46% of people support the idea, while 38% oppose it, with a notable 16% unsure. Republicans show overwhelming support at 75%, while only 24% of Democrats favor the plan.

Independent respondents are mostly divided, with 39% in favor and 43% against. Demographic factors, such as gender and race, influence opinions. Men support it more at 50% compared to 42% for women. Support varies by race, with 51% of whites in favor versus 36% of Black and Hispanic respondents. Additionally, support increases with household income and investment status.

Despite polling favorably among his supporters, the broader economic implications of Trump's tariff plan raise questions. Economists generally argue that tariffs may pose a burden on consumers, especially those with lower incomes. They can also impact countries that rely on U. S. exports.

Recent comments from Trump about imposing a 25% tariff on Canada and Mexico and larger tariffs on China have alarmed European officials. Trump suggests that a general 10% tariff could be introduced, particularly targeting Chinese goods with a 60% tariff, which is being viewed as a negotiating tactic.

While Trump is unlikely to fundamentally change tax and trade policy, he believes in using tariffs as a means to stimulate the American economy, particularly in areas that have seen a decline in manufacturing. Historical declines in U. S. manufacturing jobs have substantially affected parts of the Midwest.

The topic of tariffs and their potential to replace income tax raises multiple questions. Would tariffs collect enough revenue to sustain government finances? For example, in 2023, the U. S. collected $2. 2 trillion in income taxes while importing $3. 8 trillion worth of goods, suggesting a massive tariff increase would be necessary to match income tax revenue levels.

Despite public support aligning with Trump's views, many economists feel that the benefits of free trade outweigh the drawbacks and that tariffs may not address the core problems of the manufacturing sector. Overall, while some Americans support a shift to tariffs over income taxes, concerns and discussions among experts continue regarding effective economic strategies moving forward. 

https://issuesinsights.com/2024/12/23/americans-mostly-like-trumps-idea-of-replacing-income-tax-with-tariffs-ii-tipp-poll/

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