President-elect Donald Trump announced on Tuesday that he
plans to create an "External Revenue Service" to handle tariff
collection, just days before his inauguration.
In a statement shared on social media, Trump outlined his
intentions to impose substantial tariffs on both allies and adversaries, aiming
to pressure nations into addressing issues like migration and drug trafficking.
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Trump has already committed to imposing tariffs on key
trading partners, including Mexico, Canada, and China. He has also suggested
applying universal tariffs on all imports, with higher rates on Chinese goods.
In his Truth Social post, Trump explained that the new
agency would be responsible for collecting tariffs, duties, and all revenues
from foreign sources. He specified that the "External Revenue
Service" would officially launch on January 20, 2025, the day he assumes
office.
The name of the proposed agency is a reference to the
Internal Revenue Service (IRS), the U.S. government agency responsible for tax
administration.
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While Trump has previously claimed that countries like China
would bear the cost of tariffs, these taxes on imported goods are actually paid
by U.S. importers, with the financial burden often shared by exporters and
consumers.
Trump did not elaborate on how the new agency would be
structured or implemented. In his post, he also criticized past U.S. trade
agreements, describing them as "soft and pathetically weak."
The U.S. has traditionally used free-trade agreements to
build global relationships, but this approach has been reevaluated in recent
years, including during President Joe Biden’s administration.
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