Tariffs’ economic footprint

Tariffs are no longer being treated as a temporary trade fight inside corporate America. In a PwC survey published this week, 86% of United States executives said tariffs are now a “permanent planning assumption.” (finance.yahoo.com) That survey covered 633 United States executives last month, and PwC said many now expect tariffs to last beyond President Donald Trump’s administration. PwC’s broader 2026 Global Chief Executive Officer Survey, released January 19, also found only 30% of chief executives were confident about revenue growth over the next 12 months, down from 38% in 2025. (finance.yahoo.com) (pwc.com) The economic case for tariffs is producing mixed scorecards. A Yahoo Finance report, citing Bureau of Economic Analysis data, said the United States goods and services deficit for January and February 2026 fell by $136.1 billion, or 54.8%, from the same period in 2025, while exports rose $62.6 billion and imports fell $73.5 billion. (finance.yahoo.com) But tariff revenue and a narrower trade gap do not mean tariffs are cost-free. The Budget Lab at Yale estimated on April 2 that the 2025 tariffs had raised $214.7 billion in inflation-adjusted customs revenue above the 2022 to 2024 average as of February 2026, while also pushing imported core goods and durable goods prices up 1.5% during 2025 through January. (budgetlab.yale.edu) The same Yale analysis said the current average effective tariff rate stands at 11.0%, the highest since 1943 if 2025 is excluded. If the current Section 122 tariffs expire after 150 days, Yale estimates the rate would still be 8.2%, the highest since 1946. (budgetlab.yale.edu) Yale also estimated that if Section 122 tariffs expire on schedule, the long-run price effect would still amount to a loss of about $650 to $780 for the average household. If those tariffs are made permanent, Yale put the household loss at about $1,130 to $1,340. (budgetlab.yale.edu) The longer-run growth numbers are also negative in Yale’s model. Its April 2 report estimated the United States economy would be persistently 0.1% smaller in the long run, or about $27 billion a year in 2025 dollars, even though manufacturing output would rise 0.7% and construction output would fall 2.0%. (budgetlab.yale.edu) Other tax analysts are also treating tariffs as a broad domestic tax increase. The Tax Foundation said the tariffs in place in 2026 would increase taxes by about $600 per United States household, and said the remaining Section 232 and Section 122 tariffs would reduce long-run United States gross domestic product by 0.2% before foreign retaliation. (taxfoundation.org) The legal backdrop changed in February. The Tax Foundation said the Supreme Court ruled 6-3 on February 20, 2026, that the International Emergency Economic Powers Act did not authorize tariffs, after which the administration imposed a 10% Section 122 tariff on nearly all countries effective February 24. (taxfoundation.org) That helps explain why executives are planning around tariffs instead of waiting for them to disappear. The policy has already survived court fights, shifted from one legal authority to another, and left companies pricing goods, choosing suppliers, and setting budgets as if import taxes will remain part of normal business. (finance.yahoo.com) (taxfoundation.org)