Former President Donald Trumps domestic policy agenda would amount to a tax increase on the vast majority of American households, according to a new analysis by a Washington, D.C., think tank, thanks largely to his proposed tariffs on imported goods.

Trump has called for a host of tax cuts, campaigning on novel ideas to eliminate taxes on workers tips and overtime pay, and even to allow homeowners to take unlimited federal deductions for the property taxes they pay to state and local governments.

Those tax breaks, combined with an extension of across-the-board tax rate reductions Trump enacted as president in 2017, would save most households hundreds or thousands of dollars.

But his proposed tariffs, which would be largely passed onto consumers as increased prices, would more than offset those tax cuts for all income groups outside the richest 5 percent, the Institute on Taxation and Economic Policy said in an analysis it published on Monday .

Taken together, the tax cuts and tariffs would cost households in the middle 20% of the income distribution an average of $1,530 in 2026, the analysis found, while the richest 1% would save $36,320. Only 5% of the wealthiest households would come out ahead under Trumps plans.

Trump has proposed a 20% tariff on all imported goods and tariffs of 60% or higher on imports from China. A wide range of economists say American consumers would wind up bearing the burden of the tariffs, because even though the government would impose the levy on the companies importing the goods, those companies would in turn jack up their prices in order to offset the cost of the tariffs. Thats why economists sometimes describe the tariff proposal as a national sales tax.

Trump has flatly rejected the consensus.

I have no sales tax. Thats an incorrect statement, Trump said at last months debate with his Democratic presidential rival, Vice President Kamala Harris. Were doing tariffs on other countries.

The conservative Tax Foundation has said Trumps tariffs would essentially be an excise tax and that his proposals would set tariffs at levels not seen since the Great Depression .

Tariffs on the scale that former President Trump has proposed would massively disrupt the economy, the Institute on Taxation said in its analysis. They would cause substantial price increases on imported goods, severely damage the industries that rely on imports, hurting employment in those industries, and result in price increases for goods for which final production occurs domestically.

As part of his overall tax plans, Trump has announced a hodgepodge of tax cuts on certain types of income: tips, overtime pay and Social Security benefits. The GOP candidate has claimed these policies together would boost income for working-class families and encourage employers to hire more.

But the reports authors found that the benefits of these cuts would fall disproportionately to upper-middle-class earners, with only small or modest benefits flowing to low- and middle-income earners.

For instance, people making between $28,600 and $55,100 per year would see an average tax reduction of just $190 due to these provisions, the authors project. But people making between $157,500 and $360,000 would see a much larger average tax reduction of $3,420.

The authors say that families of modest means wouldnt be able to take full advantage of these policies because of other tax exemptions they receive and the lower tax rates theyre subject to.

The proposals could also significantly change worker and employer behavior, by prioritizing certain types of income over others. For instance, eliminating taxes on tips would encourage paying workers through gratuities rather than normal wages and could accelerate the practice of tipping throughout the economy, even as consumers grow weary from tip creep.

Critics of these plans have also warned they would be abused for instance, by shifting high-income earners, like lawyers, into gratuity-based pay just to avoid taxes.

The figures in the ITEP report assume no gaming or behavioral response with these tax cuts, meaning they could turn out even more costly and regressive than the authors estimate.

In a separate analysis on Monday, the Committee for a Responsible Federal Budget said Trumps tax plans could cost the government as much as $15 trillion, whereas the Harris campaigns proposals could cost $8 trillion.

In a statement, Trump campaign adviser Brian Hughes downplayed the deficit impact of his proposals.

President Trumps historic tax cuts laid the foundation for robust, non-inflationary growth that fueled more revenue for the federal government, not less, Hughes said. President Trumps plan will rein in wasteful spending, defeat inflation, reduce the burden of interest costs, and ignite economic growth that fuels federal revenue, so we can make our economy great again.