Tax Foundation
Washington DC think tank publishing widely-cited US tax and fiscal policy analysis since 1937.
Last refreshed: 16 April 2026
Can the Tax Foundation's $600 tariff burden figure survive scrutiny as recession fears mount?
Timeline for Tax Foundation
Calculated effective 2026 tariff rate at 5.6 percent with $600 household burden
US Midterms 2026: Q1 GDP contracts under tariff drag- What is the Tax Foundation and why is it cited so much on tariffs?
- The Tax Foundation is a nonpartisan Washington DC research group founded in 1937. It calculated the 2026 effective US tariff rate at 5.6 per cent — the highest since 1933 — and the per-household burden at $600/year, figures that became the most-cited independent measure of the tariff programme's cost.Source: Tax Foundation / Bureau of Economic Analysis
- How did the Tax Foundation calculate the $600 tariff burden per household?
- The Foundation applied the new effective tariff rate (5.6 per cent of dutiable imports) across average household consumption of imported goods, producing a $600 annual cost estimate. The figure is an average; burden varies by income level and spending pattern.Source: Tax Foundation
- Is the Tax Foundation conservative or nonpartisan?
- The Foundation describes itself as nonpartisan and is cited across the political spectrum. Most analysts place it in the centre-right of the Washington policy landscape given its general preference for lower, simpler tax rates.
- What is the State Business Tax Climate Index?
- An annual Tax Foundation ranking comparing all 50 US states on the competitiveness of their tax codes, covering corporate, individual, sales, property, and unemployment insurance taxes. It is the most widely cited such index in state policy debates.Source: Tax Foundation
Background
The Tax Foundation became a primary source in the 2026 tariff debate after its analysts calculated the effective US tariff rate had risen to 5.6 per cent — the highest since 1933 — translating to a $600 annual burden per household. Those figures were cited in Federal Reserve briefings, congressional testimony, and media coverage when first-quarter GDP contracted by 0.3 per cent, the first contraction of Trump's second term.
Founded in 1937 and headquartered in Washington DC, the Tax Foundation is a nonpartisan research organisation focused on tax policy at the federal and state level. Its annual State Business Tax Climate Index is the most-cited comparative ranking of state tax competitiveness. On federal issues it publishes distributional analyses of proposed rate changes, revenue scoring, and historical comparisons of effective tariff and income-tax burdens. The Foundation describes its approach as favouring simplicity, transparency, and neutrality in the tax code; critics on the left argue its methodology systematically understates the distributional cost of rate cuts for high earners, while critics on the right occasionally challenge its trade-cost modelling.
The Foundation occupies a centre-right position in the Washington policy landscape, frequently cited by Republican legislators on rate reform but also consulted by Democratic staff on distributional scoring. It is institutionally distinct from the Heritage Foundation, the Cato Institute, and other conservative think tanks, and draws funding from a broad donor base including foundations across the ideological spectrum. Its tariff-burden figures carry outsized credibility in economic coverage because they translate aggregate trade-policy data into per-household terms that are both politically legible and empirically grounded.