Graphics: Trump's tariff tactics to stoke inflation, increase tax burden

U.S. President Donald Trump raised tariffs on all steel and aluminum imports to 25 percent on Monday, following the earlier tariff increases on Canada, Mexico and China announced on February 1. Data suggested that Trump's tariff tactics will stoke inflation and increase the tax burden on U.S. consumers.

Trump's 25-percent tariff on most goods from Canada and Mexico, a 10-percent tariff on Canadian energy imports and an additional 10-percent tariff on Chinese imports would cost the median U.S. household over $1,200 per year, according to the Peterson Institute for International Economics (PIIE).

Trump has promised tax reductions while running for president, but most U.S. households are bound to see a net tax increase. He has prioritized extending the 2017 Tax Cuts and Jobs Act (TCJA), which would otherwise expire at the end of 2025, but the tax cuts are not sufficient to cushion most households from negative impact of the tariffs.

Trump's tariff increases against U.S. top three largest trading partners are projected to reduce U.S. GDP by 1.5 percent in 2025 and raise inflation by 0.4 percentage points, according to EY-Parthenon estimates. The PIIE projects the incremental tariffs will raise inflation by 0.54 percentage points in 2025.