By Helen Coster

NEW YORK (Reuters) – Republican presidential candidate Donald Trump has made tariffs and tax cuts the key elements of his economic pitch to voters, the majority of whom view the economy as the biggest campaign issue of the 2024 presidential election.

Several prominent budget forecasters have estimated that Trump’s tax cut plans would add some $3.6 trillion to $6.6 trillion to federal deficits over a decade, depending on which proposals are included. The same forecasters show Harris’ spending and tax break plans would add far less to deficits and possibly may reduce them, with a range of a $400 billion reduction over a decade to a $1.4 trillion increase, depending on which proposals are included.

Tariff Proposals

Tariffs on Imports

Trump has floated plans for blanket tariffs of 10% to 20% on virtually all imports as well as tariffs of 60% or more on goods from China, aiming to boost U.S. manufacturing.

On Sept. 23, Trump said he would slap a 200% tariff on John Deere’s imports into the United States if the company moved production to Mexico as planned, comments that negatively impacted the agricultural equipment manufacturer’s share price.

Frequent statements from Trump suggested he would hit automakers that move their production to Mexico with a 200% tariff, with his comments on agricultural companies marking a notable expansion of this threat. Such tariffs would likely violate the U.S.-Mexico-Canada Agreement on trade that he signed into law in 2020.

During a Sept. 24 speech in Georgia, Trump announced a plan to impose 100% tariffs on every car crossing the U.S.-Mexico border and promised to reward U.S.-based manufacturers with R&D tax credits.

The National Retail Federation, representing Walmart and other major companies accounting for nearly half of container shipping volume, opposes Trump’s proposed tariffs. Economists warn these tariffs could reignite inflation.

A narrow majority of U.S. voters supports Trump’s campaign vow to increase tariffs on imported goods, particularly from China, according to a Sept. 11-12 Reuters/Ipsos poll.

Tax Cut Proposals

Tax Cuts for Domestic Producers

In early September, Trump pledged to reduce the corporate tax rate from 21% to 15% for companies manufacturing in the U.S. While he had previously proposed cutting the corporate tax rate to 15%, this was the first time he tied the lower rate to domestic production.

Trump had reduced the corporate tax rate to 21% from 35% during his presidency from 2017-2021.

No Tax on Overtime Pay, Tips or Social Security Income

On Sept. 12, Trump stated that if elected, he would end all taxes on overtime pay as part of a broader tax cut package. He also aims to terminate the taxation of tips, which current law requires to be reported as income, a pledge echoed by Harris. Additionally, Trump intends to exempt Social Security income from taxes.

Extend Tax Cuts

Trump aims to extend all individual tax cuts from 2017, including those benefiting the wealthiest Americans. Tax and budget experts estimate this move could reduce revenue over a decade by approximately $3.3 trillion to $4 trillion.

Unclear Proposal on ‘SALT’ Deduction

In a Sept. 17 Truth Social post, Trump promised to “get SALT back” – referring to the state and local tax (SALT) deduction. At a rally the following day, he mentioned restoring the SALT deduction if re-elected, though it remains unclear whether he intends to remove the $10,000 cap imposed by his 2017 tax cuts that primarily affects high-tax, Democratic states like New York.

Other Economic Proposals

Beyond tax cuts and tariffs, Trump has pledged support for the oil and gas industry by backing new pipelines and restoring fracking on federal land to invigorate the economy. On Sept. 24, he stated he would consider putting Alaska’s Arctic National Wildlife Refuge back into play if he wins the election.

Additionally, he has hinted at ending a $7,500 tax credit for electric vehicle purchases, a credit he sought to repeal during his presidency before it was expanded by President Joe Biden in 2022.

During a Sept. 18 campaign rally in New York, Trump promised to impose a temporary cap on credit card interest rates of “around 10%.”