The Big Money Show panel discusses President Donald Trump’s tariff-splitting plan for low- and middle-income Americans.
President that of Donald Trump The proposal to give Americans $2,000 tariff dividends could be very expensive, according to a new analysis by a budget watchdog.
Trump told reporters in the Oval Office on Monday that the federal government plans to pay the dividends by mid-2026, before the midterm elections. The timing could depend on Congress, as Treasury Secretary Scott Bessent recently said legislation would be needed to authorize dividends.
“We’re going to pay dividends later, somewhere before, you know, probably the middle of next year, a little bit later,” Trump said. “Thousands of dollars for moderate- and middle-income people.”
Trump’s proposed $2,000 tariff dividend for most Americans would cost about $600 billion a year, according to the CRFB analysis. (Anna Moneymaker/Getty Images)
The president announced the proposal in a post last week on his Truth Social platform, saying that “We are taking in billions of dollars and will soon begin paying off our HUGE DEBT, $37 trillion.” Record investment in the United States, factories and plants are rising everywhere. A dividend of at least $2,000 per person (not counting high-income earners!) will be paid to everyone. »
The nonpartisan Committee for a Responsible Federal Budget (CRFB) estimated that if Trump tariff dividends are structured like the COVID-19 era stimulus payments that were delivered to adults and children after accounting for income levels, each round of tariff payments would cost approximately $600 billion on an annual basis.
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The CRFB noted that tariffs put in place by the Trump administration have raised about $100 billion so far this year, including tariffs deemed illegal by federal courts and which are awaiting appeal in court. Supreme Court.
On an annual basis, tariffs imposed by the Trump administration — including those that could be overturned by the Supreme Court — are expected to raise about $300 billion annually. In contrast, net new tariff revenues that are not subject to the Supreme Court’s ruling generate just under $100 billion annually.
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Tariffs are taxes on imported products that are paid by importers, who typically pass on some of these higher costs to consumers through higher prices. (Qian Weizhong/VCG via Getty Images / Getty Images)
It is unclear whether the president intends to pay the tariff dividends annually or at less frequent intervals, nor what the dividend amount is given that he stipulated “at least $2,000 per person” in his social media post.
The CRFB stated that if dividends of $2,000 were paid annually, they increase deficits of $6 trillion over 10 years, adding that the cost is “about twice as much as President Trump is expected to raise over the same period.”
If the administration were to pay tariff dividends on a revenue-neutral basis, if current tariffs remain in effect, these $2,000 dividends could be paid every two years starting in 2027, according to the analysis.
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However, if the lower court rulings are upheld by the Supreme Court and much of the Trump administration’s tariffs are found illegal, the remaining tariff revenue would be enough to pay $2,000 in dividends after seven years.
“Using tariff revenue to pay dividends would mean that the revenue could not be used to reduce deficits or offset borrowing from the One Big Beautiful Bill Act,” CRFB wrote.
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The analysis also found that using tariff revenue for rebates or dividends, rather than to reimburse national debtwould increase debt as a proportion of gross domestic product (GDP) to 127% by 2035, higher than the 120% under current law. If $2,000 in dividends were paid each year, that would bring the debt to 134% of GDP.
