CBO highlights the good news in Trump’s lost tariff revenue hiking the deficit by $2 trillion: Lower inflation and unemployment—and higher GDP

The Supreme Court’s decision to strike down the bulk of President Donald Trump’s tariffs has created a consolation prize for an administration hell-bent on using tariff revenue to bolster the U.S. economy. While the loss of an estimated $300 billion per year in income from tariffs has disappeared, fewer tariffs mean U.S. consumers and firms can breathe a sigh of relief over some alleviated pricing and labor challenges.

A Congressional Budget Office (CBO) report published on Thursday estimated the termination of tariffs under the International Emergency Economic Powers Act (IEEPA) would grow the U.S. deficit by $2 trillion from 2026 to 2036 compared with baseline projections from when the tariffs were in place last year. That sum includes $1.6 trillion in primary deficits, as well as $400 billion in outlays for interest.

The loss of the IEEPA tariffs is a massive blow to the administration’s hopes of tariff revenue not just paying down the nearly $39 trillion national debt, but being used to give rebates to Americans and replace income tax.

However, CBO director Phillip Swagel noted lower le...