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Taxes, tariffs and more: 5 key economic stakes of the US election

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2 years ago

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The U.S. election on Tuesday will have far-reaching economic consequences, ranging from how Americans are taxed to how the country trades with the rest of the globe.

Democrat Kamala Harris and Republican Donald Trump present starkly different policy visions that will also shape the flow of immigrants into the labor market and make-up of the energy supply that powers industry. Their differences will influence the prices consumers pay for everyday goods and the borrowing costs households and businesses face on debts.

Much will depend not only on who wins the White House but also which party controls Congress. That’s especially so for tax proposals, which must be approved by lawmakers. Still, the president has independent authority to take sweeping actions, particularly on trade and immigration.

Donald Trump and Kamala Harris - facing pics
Donald Trump and Kamala Harris

Stephen Maturen/Getty Images and/Photographer: Stephen Maturen/Ge

Here’s a look at five of the most significant economic impacts of the election outcome.

Taxes

Trump has put lowering income taxes front and center of his campaign. He’s promised to extend tax cuts passed during his first term — otherwise set to expire at the end of next year — and also further reduce corporate income taxes. On the campaign trail, he’s embraced additional ideas for tax cuts, including ending taxation of tips, overtime pay and Social Security benefits. He claims the revenue loss would be partially offset with new tariffs on imported goods.

Harris has only committed to extending the 2017 Trump tax cuts for those earning less than $400,000 and says she would roll back the expiring tax cuts for the richest Americans. She has pledged to raise the corporate income tax rate and impose a minimum tax for billionaires. She would expand child tax credits for families and offer breaks for smaller businesses.

The impending expiration of the 2017 tax cuts likely forces action on tax legislation next year. Neither party wants to take responsibility for tax increases on the middle class, so tax policy will dominate Congress in the next session.

The make-up of Congress will be critical to the outcome. An election sweep in which the same party wins control of the presidency, Senate and House would clear the way for a partisan plan. But divided government would force a negotiated deal.

Trade

The biggest potential shock to business would come from Trump’s plan to sharply raise tariffs to try to force manufacturers to move production to the US. The Republican has called for minimum tariffs between 10% to 20% on all imported goods, rising to 60% or higher on imports from China. 

Bloomberg Economics projects the maximal version of the plan, with the across-the-board tariff at 20%, would lower US GDP by 0.8% and add 4.3% to inflation by 2028 if China alone retaliates. If the rest of the world also retaliates, the blow to growth would be greater, lowering US GDP by 1.3%, but would add just 0.5% to inflation because of the weakened US economy.

Harris has signaled broad continuity with the trade policies of the Biden administration and also has warned Trump’s proposals would amount to a “national sales tax” on consumers.

Both candidates have said they would block a proposed Japanese takeover of United States Steel Corp., signaling a consensus on a hawkish attitude to foreign investment in sensitive sectors. The president has considerable unilateral authority to act on trade policy.  

Immigration

Trump has promised the biggest deportation of unauthorized migrants in history, a move that would immediately hit sectors such as construction, hospitality and retail that rely heavily on immigrants — with both legal and illegal status in the country. Economists say such a move would jolt the labor market, disrupt business and cost billions of dollars to carry out. 

Harris would take much more modest steps. She promised to re-introduce legislation clamping down on illegal border crossings, a policy that would require bipartisan support in the event of a divided Congress after the election. The president has wide-ranging powers on immigration.

Energy

Trump has adopted the motto “drill, baby, drill.” He promises to cut down on regulation of oil, natural gas and coal production and promises to make more federal land available for fossil fuel production, arguing that will bring down costs. The former president also says he will “terminate” Biden administration policies that offer subsidies to boost green energy production.

Harris leans into a clean-energy transition. The vice president has pledged to lower household energy costs but her agenda is committed to tackling the climate crisis through clean energy and protecting public lands.

Deficits

If either candidate has their way, U.S. budget deficits will go up, analysts say, but the jump would be nearly twice as big under Trump. Larger deficits typically mean higher interest rates and borrowing costs, for both households and businesses. 

Harris’s campaign plans would increase the deficit by as much as a cumulative $3.95 trillion over a decade while Trump’s would drive up the deficit by as much as $7.75 trillion, according to estimates by the Committee for a Responsible Federal Budget, a nonpartisan fiscal watchdog group.  

So far, investors appear sanguine on the outlook for U.S. fiscal policy regardless of who wins. Appetite for purchasing Treasury bonds has held up even as the U.S. annual deficit for the fiscal year ended Sept. 30 rose to $1.83 trillion from $1.7 trillion the previous year. 

Still, some analysts warn that an unsustainable fiscal trajectory risks sparking market volatility. U.S. debt is already set to reach 99% of GDP this year. Bloomberg Economics estimates that Trump’s tax cuts could take it to 116% in 2028, and even under Harris’ more conservative proposals it would rise to 109%.

A divided government, in which the opposition party controls at least one chamber of Congress, could rein in deficits since Congress must approve both spending and taxes. 

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Accounting

AI-Driven Automation and Continuous Accounting Frameworks

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3 days ago

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August 15, 2026

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The accounting profession is undergoing a fundamental structural transition as enterprise finance departments shift from periodic month-end closes toward automated continuous accounting models. By integrating specialized machine learning algorithms directly into enterprise resource planning (ERP) platforms, chief accounting officers are transforming financial reporting from a retrospective exercise into a real-time operational asset.

The Shift from Periodic Close to Continuous Financial Reporting
Traditional accounting workflows heavily relied on manual data reconciliation, spreadsheet calculations, and multi-week closing cycles at the end of each fiscal period. In contrast, continuous accounting frameworks utilize automated software agents to process, validate, and post transactional data in real time as business activities occur.

Automated bank reconciliation tools cross-reference incoming bank feeds, invoice records, and purchase orders automatically. By resolving transactional variances instantly throughout the month, corporate accounting teams eliminate the traditional workload spikes associated with quarterly and annual closes.

Machine Learning in Audit Trails and Anomaly Detection
Advanced natural language processing (NLP) and machine learning tools are redefining internal audit and financial control environments. Automated systems analyze 100% of general ledger entries, identifying anomalous transactions, duplicate payments, and unauthorized journal entries in real time.

Rather than relying on random statistical sampling, corporate internal auditors can focus their attention on high-risk flags automatically surfaced by algorithmic monitoring platforms. This continuous risk assessment strengthens internal controls over financial reporting (ICFR) and significantly reduces fraud risk.

Evolving Roles for Accounting Professionals
As routine data entry and manual reconciliation tasks become fully automated, the skill set required for accounting professionals is shifting toward data analysis, system design, and strategic business advisory.
– Systems Governance: Accountants are increasingly responsible for monitoring algorithmic accuracy and managing data integration pipelines.
– Business Partnership: Finance professionals leverage real-time financial dashboards to advise operational leaders on margin management and working capital allocation.
– Regulatory Compliance Management: Accounting teams utilize automated platforms to ensure compliance with dynamic tax codes and international accounting standards.

Core Implementation Recommendations
1. Deploy Automated Reconciliation Tools: Integrate continuous transaction processing modules into existing enterprise ERP architectures.
2. Establish Algorithmic Governance Controls: Implement strict internal testing protocols to ensure automated accounting rules comply with GAAP/IFRS standards.
3. Reskill Accounting Teams: Invest in training finance staff on data analytics, workflow automation, and predictive financial modeling.

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Accounting

Global ESG Reporting Standards and Double Materiality Compliance

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1 week ago

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August 9, 2026

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Corporate accounting departments face expanding reporting expectations as international sustainability disclosure standards achieve regulatory enforcement across major global jurisdictions. Chief Accounting Officers (CAOs) and corporate controllers are establishing rigorous internal accounting controls to treat Environmental, Social, and Governance (ESG) metrics with the same data precision, auditability, and governance as traditional financial statements.

Regulatory Harmonization Under Global Sustainability Frameworks
The implementation of standardized sustainability reporting frameworks—notably rules established by international sustainability accounting boards—has created unified expectations for public and large private enterprises. Corporations must report standardized metrics covering greenhouse gas emissions (Scope 1, 2, and material Scope 3), energy utilization, workforce demographics, and supply chain governance.

In Europe and other participating international jurisdictions, double materiality principles are mandatory. Under double materiality, organizations must report both how external sustainability risks impact corporate financial performance, and how internal corporate operations affect surrounding environmental and social structures.

Integrating Sustainability Metrics into Core ERP Systems
To provide auditable non-financial data, enterprise organizations are integrating specialized carbon accounting and ESG management platforms directly into core ERP systems. Automated data collectors capture energy utility invoices, logistics fuel consumption metrics, and vendor compliance records in real time.

Establishing automated, traceable data pipelines ensures that non-financial reporting is supported by clear audit trails. This structured approach allows external financial auditors to provide reasonable assurance on sustainability disclosures during annual corporate reporting cycles.

Financial Impacts and Capital Market Disclosure
Accurate ESG reporting directly influences corporate cost of capital and institutional credit ratings. Commercial lenders and institutional asset managers systematically incorporate sustainability metrics into risk pricing models. Companies that demonstrate transparent, verifiable progress in operational energy efficiency and climate risk mitigation benefit from expanded access to green bond markets and lower debt pricing.

Action Steps for Accounting Leadership
1. Implement Double Materiality Frameworks: Conduct comprehensive assessments to identify material financial and operational sustainability metrics.
2. Build Auditable Non-Financial Data Pipelines: Automate ESG data collection within core accounting software to ensure data integrity.
3. Align Sustainability with Annual Financial Filings: Prepare non-financial disclosures concurrently with financial statements to satisfy regulatory audit expectations.

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Accounting

Modernizing Internal Controls: Machine Learning and Continuous Monitoring in Auditing

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2 weeks ago

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August 5, 2026

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Internal audit departments and corporate risk managers are modernizing internal control frameworks by shifting from periodic sampling techniques to continuous monitoring and machine learning analytics. As operational data volumes increase across enterprise organizations, automated control testing ensures financial integrity, prevents corporate fraud, and streamlines annual audit engagements.

The Limitation of Periodic Audit Sampling
Historically, internal and external auditors evaluated internal controls by reviewing random samples of financial transactions—often analyzing less than five percent of total ledger entries. In complex enterprise environments, periodic sampling methods carry inherent risks of overlooking localized financial misstatements, unauthorized disbursements, or operational control breakdowns.

In 2026, progressive internal audit functions are utilizing automated continuous monitoring platforms that evaluate one hundred percent of financial transactions in real time. Continuous control auditing systems continuously monitor general ledger entries, procurement approvals, and expense reimbursements across all operating subsidiaries.

AI-Powered Fraud Detection and Anomaly Identification
Machine learning models trained on historical corporate financial data excel at identifying subtle transactional anomalies that indicate potential fraud or operational error. Automated systems instantly flag duplicate invoice payments, unapproved vendor creation, unusual journal entry timing, and unauthorized override of authority thresholds.

When an anomaly is detected, the automated auditing platform generates an instant risk alert, allowing internal audit teams to investigate root causes immediately. Early detection prevents minor operational errors from escalating into material weaknesses in financial reporting.

Streamlining External Audit Preparation
Continuous internal control monitoring delivers significant benefits during annual external financial audits. External audit firms can review continuous audit logs and automated control testing documentation, reducing the time required for manual field testing.

This integrated approach lowers overall audit compliance fees, reduces administrative burdens on corporate accounting staff, and provides senior management and audit committees with real-time visibility into the organization’s overall risk profile.

Core Implementation Guidelines
1. Transition to 100% Data Testing: Replace legacy sampling methods with automated continuous audit monitoring systems.
2. Deploy Anomaly Detection Algorithms: Implement machine learning models to identify unauthorized transactions and operational control overrides.
3. Align Internal and External Audit Workflows: Coordinate continuous control testing protocols with external auditors to optimize annual compliance cycles.

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