New Senate Proposal Seeks Tariff Tax Rebates for US Workers

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The latest from Capitol Hill is that millions of people in the United States could receive fresh “stimulus checks” (tax rebates), funded through revenue collected from President Donald Trump’s tariffs on imported goods.

That is the promise behind the American Worker Rebate Act, introduced in 2025 by Sen. Josh Hawley (R-Mo.) and seemingly backed by Trump.

"My bill…would enable diligent Americans to reap the benefits from the wealth generated by Trump's tariffs returning to our nation,” Hawley stated in a press release.

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Trump has also chimed in, saying, “We have so much money coming in from tariffs that a little rebate for people of a certain income level might be very nice.”

But what about the federal deficit? And, can this proposal pass Congress? Here’s what you need to know.

New stimulus checks? What Is the American Worker Rebate Act?

Sen. Hawley’s proposal would use tariff revenues — taxes collected on foreign imports, which supporters say have surged under President Trump’s sweeping trade policies — as the funding source for new tax rebates.

That would be a change from the popular federal stimulus checks many may remember from the pandemic era, which were funded by government borrowing.

The U.S. Treasury Department reported nearly $27 billion to $30 billion in revenue generated from tariffs in June 2025 alone. Thats an increase from $4 billion the previous year.

So far, tariff revenue for the fiscal year has surpassed $113 billion, according to a Reuters report.

If passed, rebates would be structured as refundable tax credits tied to the 2025 tax year. U.S. taxpayers would receive checks directly from the government, potentially starting later this year or in 2026.

How much and who would qualify?

Eligibility for the "tariff stimulus checks" would depend on income.

Individuals earning under $75,000 annually, heads of household under $112,500, and couples filing jointly under $150,000 would be eligible for the full rebate.
Above those thresholds, rebate amounts would decrease by 5% for each dollar over the limits, phasing out entirely for higher earners.
The bill would exclude nonresident aliens, dependents claimed on another’s tax return, estates, and trusts.

The bill would reportedly provide at least $600 per adult and dependent child, meaning a family of four could receive a minimum of $2,400 in rebates.

The $600 would be a guaranteed minimum per eligible person. But if tariff revenues exceed projections, payments could increase proportionally.

President Trump voiced support, telling reporters, “We’re thinking about a little rebate. But the big thing we want to do is pay down debt. But we’re thinking about a rebate,”

Sen. Hawley stressed the need for new payments in a post on X: “Working people need relief now… They’ve earned it. Let’s return their money to them asap.”

Tariff rebate checks: Federal debt and the road ahead

Although the idea of federal stimulus checks funded by tariffs has generated chatter, the American Worker Rebate Act is still just a proposal that would need congressional and Presidential approval to become law.

So, currently, no new federal stimulus checks are scheduled for 2025. But if approved, the bill text indicates that the government would distribute payments as early as late 2025 or in 2026, depending on the progress of the legislation.

However, critics caution that while tariff revenue has increased recently, the federal government still faces a substantial deficit.

The U.S. federal deficit for fiscal year 2025 is estimated to be around $1.4 trillion as of the end of May 2025, which is generally about 7% higher than at the same time last year.

Also, President Donald Trump's tax-and-spending legislation, known by some as the "One Big Beautiful Bill," signed into law on July 4, 2025, is projected by the Congressional Budget Office (CBO) to increase federal deficits by approximately $3.4 trillion over the next ten years through 2034

That’s why some experts argue that the concept of "excess funds" from tariffs is misleading, since the overall budget still shows significant shortfalls.

Whatever happened to 'DOGE Dividends'?

You may recall a similar situation earlier this year, when Tesla CEO Elon Musk talked about "DOGE dividends." That was a plan to send $5,000 rebate checks to taxpayers using savings from cutting government waste through the Trump administration’s Department of Government Efficiency (DOGE).

The goal was to save $2 trillion, and President Trump showed interest. But the plan never materialized.
By the time Musk left DOGE in May, only a small portion of the advertised savings had been realized, and no so-called “DOGE checks” were approved.

Additionally, keep in mind that tariffs tend to increase import costs, which are often passed on to consumers. That adds another layer to the debate about who truly benefits and pays for Trump’s tariffs.

To say the least, it’s challenging to predict the odds of this bill passing Congress. But in the meantime, as Kiplinger has reported, several states are sending tax rebates or similar payments to eligible residents this year.

For more information, see our report on State Stimulus Checks Going Out This Year.

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Kelley R. Taylor is the senior tax editor at Kiplinger.com, where she breaks down federal and state tax rules and news to help readers navigate their finances with confidence. A corporate attorney and business journalist with more than 20 years of experience, Kelley has helped taxpayers make sense of shifting U.S. tax law and policy from the Affordable Care Act (ACA) and the Tax Cuts and Jobs Act (TCJA), to SECURE 2.0, the Inflation Reduction Act, and most recently, the 2025 “Big, Beautiful Bill.” She has covered issues ranging from partnerships, carried interest, compensation and benefits, and tax‑exempt organizations to RMDs, capital gains taxes, and energy tax credits. Her award‑winning work has been featured in numerous national and specialty publications.