Lawrence J. Liu (Stanford) & Alex Zhang (Emory), Tariffs and the Progressive Fiscal Constitution, 103 Wash. U. L. Rev. ___ (2026):
For more than a century, progressive taxation has constituted the American fiscal state. A resurgent and expanding tariff regime, however, threatens that commitment to progressive distribution. Given the ongoing popularity of tariffs, this Article examines how they might be designed and administered in a way that mitigates their regressive distributive impact. The Article thus develops and assesses proposals to (1) vary tariff burdens in accordance with the consumption of imported goods, (2) reduce income- or payroll-tax burdens on lower-income households, and (3) earmark tariff revenue for specified spending programs. Although none is perfect, we seek to articulate possibilities and highlight relevant considerations for policymakers seeking to make tariffs better cohere with our progressive fiscal constitution.
Conclusion: This Article assesses the resurgence of tariffs within the progressive fiscal system of the United States. For more than a century, the federal income tax has featured graduated tax rates, imposing higher tax burdens on high income groups. This longstanding statutory regime evidences a quasi constitutional commitment to progressive distribution. Tariffs deviate from this commitment. They are consumption taxes on imported goods and disproportionately burden moderate-income households that consume larger portions of their economic power. The Article evaluated policy options for diminishing tariffs’ regressive distributive effects, including varying tariff burdens in accordance with consumption, reducing or eliminating for select households’ income- or payroll-tax burdens, and earmarking tariff revenue for spending programs. Although none is perfect, this Article’s account helps lawmakers navigate the difficult distributive calculus of using an external revenue regime to vindicate trade or industrial-policy goals.
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