Is tariff money being used?
Executive summary
Tariff collections have risen sharply since 2024 and are being recorded as federal revenue in Treasury accounts, meaning the money is available to be spent or to reduce borrowing; however, significant legal challenges and differing budget estimates mean some of that revenue could be clawed back or not materialize, and there is no authoritative evidence in the reporting that tariff receipts have been ring‑fenced for a new, permanent program (such as universal "tariff dividends") [1] [2] [3].
1. Tariff receipts have surged and are being recorded in Treasury accounts
U.S. customs duties and related fees have climbed dramatically—official trackers and analyses report fiscal‑year and calendar‑year totals rising into the tens and hundreds of billions: Treasury and DHS data underpin public trackers showing sharp increases, with U.S. Customs and Border Protection collections reported in various tallies as $195 billion in FY2025 and larger calendar measures of customs duties, taxes and fees reaching figures such as $287 billion in 2025 depending on the dataset and definitions used [1] [2] [4].
2. Where the money goes: recorded as federal revenue, part of the Treasury deposit stream
Collected tariffs are deposited and reported within Treasury statements under customs‑related deposit categories (often labeled “DHS – Customs and Certain Excise Taxes”), and budget scorekeepers (CBO and others) incorporate those receipts into baseline revenue projections—meaning the money is treated like other federal revenues and available to fund government operations or reduce deficits unless otherwise directed by law [1] [5].
3. Projections differ but consensus is that tariffs will generate substantial revenue over the coming decade
Independent budget models and policy shops yield a range of multi‑year estimates—Tax Policy Center and several academic and think‑tank models project hundreds of billions in 2026 and multi‑trillion totals across 2026–2035 (examples: TPC ~ $247B in 2026 and ~$2.3T over 2026–35; Tax Foundation conventional estimates ~$2.1T over 2026–35; Penn Wharton and others produce similar but not identical projections)—all of which treat tariffs as generating real federal receipts in the baseline scenarios [6] [7] [8].
4. Legal uncertainty threatens some of the collected revenue
A material share of the recent increase in tariff revenue is linked to tariffs imposed under the International Emergency Economic Powers Act (IEEPA), and courts have found many of those IEEPA‑based tariffs unlawful; appellate rulings and pending Supreme Court review mean that some collections could be reversed or refunded, a risk explicitly noted by budget analysts and the Committee for a Responsible Federal Budget (CRFB) [2] [5].
5. “Tariff dividends” and earmarks: revenue exists but has not been committed universally
Proposals to send tariff receipts back to households as $2,000 “tariff dividends” have been publicly championed and analyzed, but thorough fiscal work shows many dividend designs would cost as much or more than projected tariff revenue; the reporting shows no confirmed, across‑the‑board implementation of such a dividend program funded directly by tariffs as of these sources [3] [9].
6. Practical effect: tariffs are being used insofar as they increase federal receipts, but their ultimate fiscal role is conditional
In practice tariff money is being collected and counted in federal revenue totals and thus available to support spending or reduce borrowing as part of the unified budget picture—the CBO and other forecasters include those receipts in baseline projections—but whether that money is ultimately spent, held, or returned depends on future legal rulings, executive decisions, and congressional budgeting choices; reporting explicitly warns that final net fiscal impacts are uncertain because of behavioral economics effects, foreign retaliation and court actions [5] [2] [8].
Bottom line
Yes—tariff money is being collected and recorded as federal revenue and therefore is being “used” in the narrow sense that it augments the Treasury’s receipts and can fund government activity or reduce borrowing—but that usage is not irrevocable: legal setbacks, refunds, macroeconomic feedback effects and policy decisions (including the absence of any enacted universal tariff dividend in the sources) mean a sizable share of the headline collections could be reversed or reallocated before becoming permanent budgetary resources [1] [2] [3].