US tariff revenue jumped in April, before China de-escalation
Rising interest costs on the public debt, along with steeper outlays on categories, continue to account for a large share of the added borrowing needs
[WASHINGTON] The US collected a record amount of revenue from tariffs in April, helping to limit a further widening of the budget deficit, though US President Donald Trump’s search for trade deals with targeted nations may scale back future amounts collected.
The Treasury Department recorded US$16 billion in customs-duties revenue for April, marking a US$9 billion – or 130 per cent – increase on the same month a year before. That’s the biggest monthly take for customs in at least a decade, according to data compiled by Bloomberg.
The jump reflected tariff hikes imposed by the Trump administration, a Treasury official told reporters. Trump on Apr 2 unveiled “reciprocal” tariffs on dozens of countries, before putting all of them except China’s on pause a week later. “Liberation Day” also featured a new universal 10 per cent baseline levy.
Monday’s (May 12) data came out hours after the US reached a tentative deal with China to remove a swath of escalatory tariffs. Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer announced that American levies on Chinese goods would come down to 30 per cent for now, from 145 per cent.
Last week, the US reached a trade agreement with the UK.
For the first seven months of the fiscal year, the federal government logged a US$1.05 trillion deficit, a 13 per cent increase on the same period a year earlier after accounting for calendar-year differences. Taking out some deferred taxes that had inflated 2024 revenue, the 2025 deficit is 4 per cent wider, a Treasury official said.
Rising interest costs on the public debt, along with steeper outlays on categories including Medicare and Social Security, continue to account for a large share of the added borrowing needs.
Besides customs, another revenue category seeing an increase this fiscal year is excise taxes, which have climbed by US$10 billion over the past seven months. That’s largely thanks to a new levy on stock buybacks, a Treasury official said. That tax was enacted as part of the Biden administration’s 2022 renewable energy package, known as the Inflation Reduction Act. BLOOMBERG
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