July 29, 2019
What President Trump’s Tariffs Will Cost Consumers
In his fourth round of tariffs, President Trump has officially ordered taxes on all imports from China. The final tranche includes a wide variety of goods that consumers buy, either directly or from retail stores. AAF’s Director of Immigration and Trade Policy Jacqueline Varas and Jonathan DeDomenico examines the composition of U.S. imports from China and concludes that imposing a 25 percent tariff on all consumer goods from China could increase prices in the United States by up to $38.2 billion annually.
Major retail stores sell directly to consumer and are highly dependent on imports of consumer goods. Tariffs on these goods would require that businesses either pass the costs entirely on to consumers, which would entail raising prices in line with the tariff rates, or cut costs in-house by altering wages, reducing workers, or cutting hours. In either case, the retail industry and consumers would suffer. Furthermore, the president and U.S. Trade Representative could no longer argue that their trade strategy shelters U.S. consumers from harm.