President Trump has repeatedly touted the revenue generated by his tariffs and over the weekend suggested using that money to send Americans $2,000 payments as a kind of “dividend.” He has not offered a detailed proposal, and the idea faces steep practical and legal challenges: the policy likely would cost far more than projected tariff revenue, could conflict with the administration’s arguments in the Supreme Court, and White House officials are already distancing the idea from direct cash payments.
Speaking with reporters, Trump said, “We’re going to issue a dividend to our middle income people and lower income people of about $2,000. And we’re going to use the remaining tariffs to lower our debt.” But budget analysts say the numbers don’t add up. Conservative Tax Foundation economist Erica York said even conservative estimates show the plan “doesn’t work.” By her calculations, offering rebates to people earning under $100,000 a year would leave at least a $100 billion gap between expected tariff receipts and the promised payouts. York added that limiting payments to those under $75,000 still wouldn’t be covered by tariff revenue, meaning the plan could increase the deficit — the opposite of Trump’s stated aim.
Observers have pointed to analyses suggesting tariff dividends could cost hundreds of billions annually, well beyond likely collections from tariffs. The White House has signaled the administration may not pursue straightforward $2,000 checks. Treasury Secretary Scott Bessent told ABC’s This Week the “dividend could come in lots of forms,” including tax reductions already proposed by the administration — for example, eliminating taxes on tips, overtime, or Social Security. A White House official said the administration is “committed to putting this money to good use for the American people,” but provided no specifics.
The rhetoric about using tariff revenue also complicates legal footing. Last week the Supreme Court heard challenges arguing that only Congress can levy taxes. Administration lawyers told the court the tariffs are regulatory, not meant to raise revenue; Solicitor General John Sauer called them “regulatory tariffs” and said any revenue is incidental. Bessent attempted to reconcile that position by saying the tariffs aim to bring business back to the U.S. In any event, Congress would have to authorize any rebate or tax change, and it is not assured lawmakers would approve such a plan.
