White House Targets $112 Billion Tariff Evasion Gap as Trump Duties Spur $19 Billion Revenue Loss
Updated
Updated · Fortune · Aug 14
White House Targets $112 Billion Tariff Evasion Gap as Trump Duties Spur $19 Billion Revenue Loss
3 articles · Updated · Fortune · Aug 14
Summary
$112 billion separated China’s reported exports to the U.S. from U.S.-recorded imports last year, a gap the White House says points to ballooning tariff evasion through transshipment.
The administration estimates tariff dodging now costs $19 billion to $26 billion in annual tax revenue, with China routing goods through more than 40 countries and other nations tolerating shell importers.
Trump’s own tariffs helped create the incentive: China duties reached as high as 145%, and current U.S. tariffs remain about 23%, more than double pre-second-term levels.
A June 3 executive order tightened rules for foreign importers of record, while Customs is using AI to flag suspicious routing and paperwork; trade lawyers say effects could show up by October.
The report warns unchecked evasion hurts compliant importers and could push tariffs even higher as Washington tries to recoup lost revenue.