What portion of US federal revenue comes from tariffs?
Executive summary
Tariffs brought the federal government roughly $77 billion in FY2024 and exploded to roughly $165–195 billion in FY2025 under new policies, meaning tariffs accounted for only a small single‑digit share of total federal revenues in 2025 (PIIE and USAFacts report tariffs were ~2.9% of projected FY2025 revenue of $5.2 trillion) [1] [2]. Analysts and budget shops agree tariff receipts rose sharply in 2025 but remain small relative to income and payroll taxes and are volatile and legally contested [2] [3].
1. Tariff revenue jumped — but it’s still small compared with total federal receipts
Multiple trackers show customs duties climbed dramatically in 2025: USAFacts cites about $165.2 billion by August and prior-year customs duties were $77.0 billion for FY2024 [1]. The Peterson Institute for International Economics calculated tariff receipts since January 2025 at $149 billion and noted that those receipts equal only about 2.9 percent of projected total federal revenue of $5.2 trillion in FY2025 [2]. Bipartisan Policy Center likewise emphasizes that the tariff share of total revenue rose sharply but remains a “small share” of overall receipts [4].
2. Different trackers give different headline numbers — know what each counts
Sources report differing totals depending on cutoffs and definitions: Treasury final statements and some press pieces cite a FY2025 headline of ~$195 billion in customs duties [5] [6] [7]. Other research teams measure revenue since January 2025 or through August and report smaller tallies ($101.2 bn, $146 bn, $149 bn) because they focus on new tariff changes or shorter time windows [8] [9] [2]. These differences reflect methodology: full fiscal‑year totals, calendar‑year to date numbers, or estimates of “new” versus pre‑existing tariffs [8] [9].
3. Headlines about replacing income tax with tariffs do not match the arithmetic in reporting
Advocates or officials have suggested tariffs could substitute for large parts of income tax revenue. Fact‑checks and budget analysts rebut that claim: tariff revenue in 2025—however measured—remains far below individual income tax receipts (personal taxes are roughly $2.7 trillion annually, while tariffs were in the low hundreds of billions at best) and thus could not replace them [6] [2]. PolitiFact explicitly finds the “math doesn’t add up” for claims that tariffs could make income taxes unnecessary [10].
4. Revenue gains are politically and legally fragile
Multiple outlets warn the 2025 surge may be temporary or reversed: several new tariffs were imposed under contested legal authorities and lower courts have ruled many of the IEEPA tariffs unlawful, a position upheld on appeal in some instances; should courts or the Supreme Court require refunds, a large portion of collected sums could be returned [3] [5]. CRFB and Fortune note scenarios in which billions would have to be repaid and future projected revenues would fall sharply [5] [3].
5. Economists flag economic offsets and distributional effects
Research groups and think tanks underline that mechanical customs receipts overstate net fiscal benefit because tariffs reduce taxable income and GDP, and retaliation or price pass‑through shifts burdens to U.S. consumers and firms [11] [9]. Tax Foundation and Yale/Budget Lab work emphasize that conventional revenue tallies do not account for negative macroeconomic feedbacks and that much of the economic cost is borne domestically [11] [9].
6. What the numbers mean for budget politics and fiscal strategy
Budget watchers say tariffs can modestly lower deficits but won’t solve structural fiscal gaps. CRFB, MarketPlace, and others call the revenue “meaningful” in the short run but “tiny” relative to trillion‑dollar deficits and the $38 trillion‑plus national debt; proposals to rely on tariffs to finance permanent tax cuts are labeled risky and politically fraught [12] [13] [14]. PIIE framed the 2025 receipts as helping only “a few percent” of the projected deficit and cautioned about volatility and timing [2].
Limitations and open questions: available sources do not mention long‑term behavioral responses beyond 2035 in detail and differ in methodology for “new” vs. total customs receipts; readers should treat single headline numbers (e.g., $195 billion) as provisional and contextualized by the trackers cited above [5] [8] [2].