President-elect Donald Trump has announced plans to establish a new federal agency, the “External Revenue Service” (ERS), to oversee the collection of tariffs and duties from foreign sources. Trump said the department would be launched on his first day in office, January 20.
In a post on his Truth Social platform, Trump described the ERS as a key step in reshaping U.S. trade policy. “Through soft and pathetically weak trade agreements, the American economy has delivered growth and prosperity to the world while taxing ourselves. It is time for that to change,” he wrote. “We will begin charging those that make money off of us with trade, and they will start paying, FINALLY, their fair share.”
Trump compared the proposed department to the Internal Revenue Service, which collects domestic taxes in the U.S.
Creating the ERS would require congressional approval, but Trump enjoys significant backing in Congress, with Republican majorities in both the House and Senate.
Critics, however, note that the ERS’s proposed functions overlap with existing agencies like the Department of Commerce and U.S. Customs and Border Protection, which already manage tariffs and duties.
Trump’s announcement comes amid his promises to impose steep tariffs on trading partners, including Canada, Mexico, and China. He has called for a 25% tariff on Canadian and Mexican exports to the U.S. and a 10% tariff on global imports, as well as a 60% tariff on Chinese goods.
Economists warn that such measures could raise consumer costs and invite retaliatory tariffs against U.S. exports. According to the U.S. Bureau of Economic Analysis, the U.S. trade deficit last year stood at $67.9 billion with Canada, $152.4 billion with Mexico, and $279.4 billion with China.
Economic experts and Democratic lawmakers criticized Trump’s proposal. Heather Long, an economic columnist at *The Washington Post*, called it “clever marketing” but warned, “American consumers will end up paying these higher tariffs.”
Senator Ron Wyden, the top Democrat on the Senate Finance Committee, said, “No amount of silly rebranding will hide the fact that Trump is planning a multi-trillion-dollar tax hike on American families and small businesses to pay for another round of tax handouts to the rich.”
The ERS proposal is part of Trump’s broader plan to reshape the federal government. He has also proposed creating a Department of Government Efficiency (DOGE), a nongovernmental advisory group aimed at streamlining bureaucracy and reducing federal spending.
Despite Trump’s campaign pledge to reduce the size of the federal government, the proposed agencies and advisory boards mark a shift toward expanding its infrastructure.
