President Donald Trump’s proposal to raise the United States defence budget to an unprecedented $1.5 trillion in the 2027 financial year would add an estimated $5.8 trillion to the national debt over the next decade, according to a new assessment by the Committee for a Responsible Federal Budget.
The proposal was outlined in a statement posted on Truth Social on 7 January, in which Trump said he had decided to pursue a far larger increase than the $1 trillion defence budget he had previously indicated. The budget watchdog estimates that lifting military spending to this level would increase defence outlays by around $5 trillion through to 2035, with interest costs pushing the overall impact on federal debt significantly higher.
Trump has argued that the expanded defence budget could be funded by revenue from tariffs imposed during his second term, while still allowing for debt reduction and rebate payments to Americans. The committee disputes this claim, saying the projected tariff income falls well short of what would be needed. The Congressional Budget Office estimates that current tariffs would raise approximately $2.5 trillion in additional revenue through 2035, or about $3 trillion once interest effects are included—roughly half the cost of the proposed increase in military spending. On a dynamic basis, which factors in economic behaviour, the revenue could be lower still.
Further uncertainty surrounds the tariffs themselves. The Supreme Court is expected to rule on whether a significant share of the levies, imposed under the International Emergency Economic Powers Act, are lawful. If those tariffs are overturned, the committee estimates that net deficit reduction from remaining tariff revenue would fall to roughly $700 billion over the same period, covering only around 15 per cent of the cost of the defence expansion.
The Committee for a Responsible Federal Budget noted that Trump has previously acknowledged these constraints, stating that military spending should remain at $1 trillion in 2027 if tariff revenues were unavailable. It also pointed to the $175 billion already allocated to defence under the One Big Beautiful Bill Act, arguing that there is little justification for a sharp increase in the near term.
The group warned that any future rises in defence spending should be fully funded through new revenue or offsetting spending cuts, particularly given the already high and rising level of US national debt. Relying on tariff revenue that is already assumed in budget forecasts, it said, would leave deficits substantially higher even if the tariffs remain in place.
In his statement, Trump described the proposed budget as essential to building what he called a “Dream Military” capable of keeping the country safe in what he characterised as “troubled and dangerous times”, while also enabling debt reduction and payments to middle-income Americans. Fiscal analysts counter that without secure and sufficient funding, the plan risks significantly worsening the country’s long-term financial position while delivering only limited economic benefits.
