US Tariff Revenues Dip for First Time

For the first time since President Donald Trump launched his broad global tariff program in April, US customs collections fell month-over-month in November. The government collected US$30.75 billion in import duties, down from US$31.35 billion in October. While tariff revenues had generally been rising since their initial surge in April, recent months have seen growth slow, with November marking the first decrease.

Several factors contributed to this reversal, including a cost-of-living crisis that prompted the administration to reduce tariffs on key consumer goods such as coffee, bananas, and beef in mid-November. These rollbacks were intended to ease price pressures on US households, especially as beef prices have climbed nearly 15% since January 2025, and 55% over the last five years, partly due to livestock disease.

Although the immediate impact on retail prices may not yet be visible, the tariff reductions have already affected federal revenue. Traditionally, a small dip in monthly tariff collections would not raise concerns, but Trump has repeatedly suggested that these funds could be used to offset income taxes, provide stimulus checks, or reduce the national debt. To date, only US$236.2 billion in tariff revenue has been collected from January to November, less than 1% of the current US$38.38 trillion US debt.

Some of the collected revenue is already earmarked for a US$12 billion aid package for farmers impacted by trade tensions with China, with US$11 billion allocated for direct payments starting next year. However, the future of a significant portion of Trump’s tariffs depends on the Supreme Court, as roughly US$90 billion of the US$174 billion collected so far was imposed under presidential authority via the International Emergency Economic Powers Act (IEEPA). Should the court rule that Trump lacked authority under IEEPA, much of this revenue could be refunded to importers, erasing a large share of this year’s collections.

US Tariffs Put Pressure on Mexican Trade and Industry

In February 2025, shortly after his inauguration, President Donald Trump imposed 25% tariffs on imports from Mexico and Canada, citing alleged shortcomings in addressing illegal migration and fentanyl trafficking. While products meeting USMCA rules of origin were later exempted, the 25% tariff still applies to goods without certification. Mexico interpreted the move as a gesture of constructive engagement, whereas Canada signaled possible retaliatory measures.

On March 12, the United States applied a 25% tariff on all steel and aluminum imports, rising to 50% on June 4. This contributed to a 60% drop in Mexican steel exports to the United States in April, prompting urgent government action. Economy Minister Marcelo Ebrard and other officials are seeking exemptions, while Sheinbaum emphasized protecting jobs, supporting industry, and ensuring fair trade conditions.

In April, Trump introduced the “Liberation Day” tariffs, imposing a baseline 10% levy on imports from most countries, later targeting 60 nations with higher tariffs, though Mexico and Canada, as USMCA members, were exempt. Automotive imports also faced tariffs; a 25% levy on foreign-manufactured vehicles, engines, and components was later reduced to around 15% for vehicles assembled in Mexico with domestic content. Despite relief, rising costs remain a concern, with Ford projecting US$1.5 billion in reduced earnings.

In July 2025, the United States proposed a 30% tariff on additional Mexican imports, temporarily suspended for 90 days while Mexico addresses non-tariff barriers, including regulatory delays, pesticide bans, restrictions in energy and lithium sectors, and telecom monopolies. Unlike prior tariffs, this measure is targeted, designed to incentivize reforms rather than impose blanket duties.

On Nov. 1 a new tariff structure for medium- and heavy-duty vehicles and key components took effect. Under USMCA rules, a 25% tariff applies only to non-U.S. content, while buses face a flat 10% rate. Critical parts such as engines, transmissions, tires, and chassis are included, with a 3.75% tax credit for domestically assembled vehicles extended through 2030. Between January and July 2025, U.S. imports of trucks, buses, and specialty vehicles totaled US$32.41 billion, with Mexico as the top exporter at US$25.86 billion, down 13.8% year-on-year.

More recently, Donald Trump warned Mexico that he will impose a 5% tariff if the country fails to meet its obligations under the 1944 Water Treaty, arguing that lacking deliveries are hurting agribusiness in Texas. He added that the United States needs Mexico to release 200,000 acre-feet of water before Dec. 31, with the remaining volume delivered shortly after.