Congressman Ro Khanna (CA-17) has introduced legislation that would require the federal government to compensate Americans for economic costs that his office says have resulted from the Trump administration’s war in Iran.
Khanna introduced the Illegal War Refund Act on Sept. 17, proposing that the government calculate the economic impact of the Iran war on U.S. taxpayers and redirect an equivalent amount from the Department of Defense budget to the Treasury. The money would then be distributed to eligible tax filers and their dependents.
According to Khanna’s office, the conflict has contributed to higher costs for American families, including increased gas and food prices, interest rates and inflation. The press release cites Moody’s Analytics Chief Economist Mark Zandi as estimating that the war has cost Americans about $230 billion, or roughly $1,760 per household.
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“Trump campaigned on lower costs and no new wars. We are now in the eighth month of an illegal war in Iran that was never authorized by Congress,” Khanna said in announcing the legislation. “While the wealthy and powerful profit off the war, American taxpayers should not bear the economic costs of the president’s broken promises. They deserve their money back.”
Under the proposed legislation, the Office of Management and Budget would be responsible for calculating the economic costs borne by U.S. taxpayers each fiscal year. The calculation would include the effects of higher interest rates, fuel prices, food prices and inflation.
The bill would then require an equivalent amount to be transferred from Defense Department funds to the Treasury. Those reductions would be made proportionally across Defense Department accounts, while excluding funding for military personnel, military construction and the Defense Health Program.
READ: Iran war drives US energy costs higher, adding over $100B burden for Americans (September 8, 2026)
The Treasury would distribute equal payments to eligible U.S. tax filers and their dependents.
The proposal also includes a provision designed to prevent the payments from being used for political promotion. It would prohibit the name, signature or likeness of any elected official from appearing on letters, checks or other documents connected to the payments.
Khanna’s legislation has five original cosponsors: Representatives Chuy García (D-IL), Bonnie Watson Coleman (D-NJ), Val Hoyle (D-OR) and Pramila Jayapal (D-WA).
The bill is also backed by several advocacy organizations, including Win Without War, Demand Progress, Public Citizen, National Iranian American Council Action, Friends Committee on National Legislation, the Quincy Institute for Responsible Statecraft and the Council for a Livable World.