July 27, 2020
Looming Tariff Increases
The Trump Administration has announced new tariffs on French luxury goods, and many are expecting that it will reimpose levies on Canadian aluminum. Neither set of tariffs are in effect yet, but both could take effect in the coming months. As the COVID-19 pandemic continues to impede global trade, these tariffs — along with any resulting retaliation — will add new burdens to the already strained economy, writes AAF’s Data Analyst Tom Lee.
The Canadian aluminum and French luxury goods tariffs combined would affect an additional $7.1 billion of U.S. imports and would increase annual U.S. consumer costs by $906 million. These tariffs come at time when the global COVID-19 pandemic has greatly reduced international trade and induced a global recession. It remains to be seen exactly what date these tariffs would go into effect, but the message remains clear: Tariffs will reduce overall economic activity and ultimately burden the U.S. consumer.