Trump to establish External Revenue Service for tarrifs

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Trump Announces Plan to Create “External Revenue Service” to Collect Foreign Tariffs

PALM BEACH, Fla. (AP) — President-elect Donald Trump announced plans Tuesday to create a new agency, the “External Revenue Service,” tasked with collecting tariffs, duties, and other revenue from foreign countries owed to the United States.

“For too long, we’ve relied on taxing our Great People through the Internal Revenue Service (IRS),” Trump wrote on TRUTH Social. “While the American economy has driven global growth through weak trade deals, we’ve been taxing ourselves. It’s time for that to change. I’m announcing the creation of the EXTERNAL REVENUE SERVICE to collect all revenues from foreign sources, including tariffs and duties.”

In a recent press conference at his Mar-a-Lago estate, Trump pledged to impose “substantial tariffs” on Mexico and Canada unless they take stronger action to curb illegal drug and migrant flows into the U.S. He also expressed his vision for a “golden age for America,” emphasizing the country’s vast natural resources.

During his campaign, Trump suggested tariffs of 10% to 20% on all imported goods, with a 60% or higher tariff on imports from China. He also threatened to impose a 25% tariff on all imports from Canada and Mexico on his first day in office, though the specifics of the plan remain unclear.

On Tuesday, Bloomberg reported that Trump’s transition team is exploring how to gradually increase tariffs using executive powers under the International Emergency Economic Powers Act. The proposed strategy would involve raising tariffs by 2% to 5% each month on trade partners, potentially offsetting inflation concerns.

Trump has appointed Scott Bessent, Kevin Hassett, and Stephen Miran to lead the strategy, with Bessent tapped for Treasury Secretary, Hassett for Director of the National Economic Council, and Miran for Chairman of the Council of Economic Advisers.

“We will start charging those who profit from trade with us, and they will finally pay their fair share,” Trump added. “January 20, 2025, will mark the birth of the External Revenue Service. MAKE AMERICA GREAT AGAIN!”

While Trump’s announcement drew attention, CBS News pointed out that U.S. agencies, including the Department of Commerce, the U.S. Trade Representative, and U.S. Customs and Border Protection, already handle tariff collection. These funds are deposited into the U.S. General Fund.

Trump has also proposed steep tariffs on China, aiming to hold the country accountable for the flow of illegal drugs into the U.S. Additionally, he threatened that the European Union must buy more American oil and gas or face “TARIFFS all the way!”