In a recent announcement, President-elect Donald Trump revealed his intention to launch a new agency named the External Revenue Service. This agency would focus on gathering tariffs and other financial contributions from foreign countries. Trump shared this vision on his social media platform, Truth Social, emphasizing the idea that those profiting from trade with the U.S. should start paying their share. He likened this proposed agency to the Internal Revenue Service, which oversees domestic tax collection.
Establishing a new federal agency necessitates Congressional approval, and with Republicans currently in control of both the House and Senate, there may be a pathway for this initiative to gain traction. Interestingly, despite his commitment to reducing governmental size, Trump appears to be advocating for a new entity that would take over responsibilities already managed by existing organizations, such as the Commerce Department and Customs and Border Patrol, which handle the collection of duties and revenues from abroad.
Additionally, the president-elect has appointed two major figures from the business world to lead a task force known as the Department of Government Efficiency (DOGE). This non-governmental group is tasked with identifying ways to downsize the federal workforce, eliminate certain programs, and reduce federal regulations, all key components of Trump’s “Save America” agenda as he prepares for a second term. Billionaire entrepreneur Elon Musk, along with fellow business leader Vivek Ramaswamy, are at the forefront of DOGE’s initiatives aimed at streamlining government operations.
Trump’s approach to tariffs, which includes the potential imposition of a 25% tax on goods from allies such as Canada and Mexico and a staggering 60% on imports from China, serves as a cornerstone of his economic strategy as he plans for his upcoming term in office. However, economists express concern that the burden of these tariffs will ultimately fall on consumers, with many viewing them as an ineffective method for governments to generate revenue and stimulate economic growth.
Refuting this strategy, Democratic lawmakers were quick to respond critically to the External Revenue Service proposal. Senator Ron Wyden of Oregon, who holds a prominent position in the Senate Finance Committee, stated that no amount of rebranding could disguise what he views as Trump’s plan for a significant tax increase that would disproportionately affect American families and small businesses, all to facilitate another set of tax cuts for the wealthy.
