Voters Reject Tariffs That Undermine the Working Families Tax Cuts

American voters delivered a strongly negative assessment of President Donald Trump's tariff policies in the 2026 midterm elections, creating an opportunity for Congress to reconsider trade restrictions that have raised costs for consumers and businesses.

According to national exit polling, 66% of voters said Trump's tariffs had hurt the national economy, compared with just 21% who believed they had helped. Voters were similarly critical of the effects closer to home, with 64% saying tariffs had hurt their local economy and only 14% reporting a positive impact.

The results reflect widespread dissatisfaction with a policy that has become a centerpiece of the administration's economic agenda. Although tariffs were not the only issue influencing the election, the polling demonstrates substantial opposition to their economic consequences.

The findings expose a contradiction in federal economic policy. The Working Families Tax Cuts encourage business investment and expansion, while tariffs increase the cost of imported machinery, materials, and consumer goods. Congress now has an opportunity to address that conflict and strengthen the administration's pro-growth tax reforms.

Tariffs Undermine the Benefits of Tax Reform

The Working Families Tax Cuts established important incentives for business investment through permanent full expensing and restored deductions for domestic research and development expenses. These provisions allow businesses to recover investment costs more quickly, encouraging expansion, innovation, and job creation.

Tariffs work against those incentives by increasing the cost of equipment and materials used by American manufacturers. Many domestic businesses rely on international suppliers for specialized machinery, industrial components, and raw materials that are unavailable domestically or more expensive to purchase from American suppliers.

When tariffs increase those costs, businesses must absorb the expense, pass it along to customers, or reduce spending elsewhere. A manufacturer may benefit from immediately deducting the cost of new equipment, only to face a higher purchase price because that equipment is subject to import taxes.

Although tariffs can benefit certain domestic producers by limiting foreign competition, those gains come at a cost to other American businesses. Broad trade restrictions can protect one industry while making products manufactured in the United States more expensive and less competitive.

The federal government should not encourage business investment through tax reform while making that investment more expensive through trade policy.

Voters Are Concerned About Higher Prices

The exit polling reinforces the economic concerns surrounding tariffs. Americans entered the midterms focused heavily on affordability, with the cost of living remaining a significant concern across party lines.

Tariffs are taxes collected from American importers, not directly from foreign governments. Although foreign producers may absorb some of the expense, American businesses and consumers frequently bear a substantial share through higher prices.

Research from the Federal Reserve Bank of New York has documented how tariffs can increase prices for imported goods and domestically produced alternatives. Manufacturers face higher production costs, while reduced foreign competition can place additional upward pressure on consumer prices.

These effects undermine household purchasing power and erode some of the benefits of the Working Families Tax Cuts. Tax relief is intended to leave Americans with more disposable income, but higher prices for everyday goods can offset those savings.

The public's concerns were evident well before the midterms. A January 2025 survey found that just 2% of registered voters identified tariffs as Trump's top priority shortly before his inauguration. While that finding did not measure overall support or opposition, it showed that trade restrictions were not among voters' leading priorities when the administration took office.

Congress Has an Opportunity to Change Course

The midterm results provide Congress with an opportunity to reconsider broad tariffs and restore greater legislative oversight of trade policy. Lawmakers could reduce or repeal import taxes that increase costs throughout the economy while preserving targeted measures addressing legitimate national security concerns and unfair foreign trade practices.

Congress has a constitutional role in determining trade policy. Article I grants lawmakers authority over taxation and foreign commerce, although substantial tariff powers have been delegated to the executive branch over time.

The Supreme Court's 2026 decision limiting the use of emergency economic powers to impose tariffs changed the legal landscape, but other statutory authorities remain available. Greater congressional involvement would improve accountability and provide businesses with more predictable trade rules when planning investments and supply chains.

Freer trade would complement the investment incentives established through the Working Families Tax Cuts. American businesses benefit from access to competitive global markets when purchasing equipment and materials, while exporters gain opportunities to sell their products abroad.

Reducing unnecessary trade barriers would lower production costs, improve competitiveness, and reinforce the benefits of pro-growth tax reform. Congress can address specific foreign trade abuses without imposing broad taxes on goods used throughout the American economy.

CFE Takeaway

The 2026 midterm exit polling revealed substantial voter dissatisfaction with President Trump's tariff policies. Roughly two-thirds of voters believed tariffs had harmed the national and local economies, reinforcing concerns about higher prices and the economic consequences of broad trade restrictions.

The Working Families Tax Cuts established important incentives for investment, innovation, and economic growth. Tariffs undermine those reforms by raising costs for American manufacturers and consumers.

Congress should use the opportunity created by the midterms to reconsider costly tariffs, restore stronger legislative oversight, and pursue a trade policy that complements tax reform. Lower taxes, restrained federal spending, and freer trade would provide a more consistent foundation for American economic growth.