President Trump is imposing extensive tariffs on the nearest trading partners in the United States. Beginning on Tuesday, companies that bring products from Canada and Mexico will pay 25 % tariffs; importers from China will pay an additional 10 % of existing taxes.
The president insists that these tariffs will not increase the price of American consumers. If someone pays the fee, it is foreign.
However, the simple review of the working method of tariffs indicates that the fact is not the case. This is what I pay for who pays.
Who pays tariffs earlier?
When tariffs enter the United States, tariffs are an additional surcharge. In fact, this is the so -called record country (the company responsible for importing the product) actually imposed tariffs on the federal government.
The tariff fee is 10 % or 25 %. Usually, the entire price of the products you see in the store is not charged. Instead, the company’s low import price of goods from foreign countries can then sell the price for sale at the store.
Many recorders with records have participated in the government’s electronic payment plan and automatically deduct the tariff costs from their bank accounts when they are brought into the country. Tariff income was collected by the US Customs and Border Protection Agency, although Mr. Trump proposed the idea of creating a new agent to deal with the money made from tariffs.
The recorders can be any nationality. They can be US or foreign companies with or without the United States. They can also work on behalf of other companies to handle their import and export customs agents.
But Miller & Chevalier’s customs lawyer Richard Mojica said that the recorders recorded are usually owners or buyers of goods, usually “usually American companies.”
Many American companies are frustrated by Mr. Trump’s statement that foreign tariffs paying tariffs on foreign countries, saying that they are paying these taxes themselves.
Arnold Kamler, chairman of Kent International, is a company in New Jersey in China and South Carolina. He said that since Mr. Trump levied his first round of Chinese tariffs on Chinese tariffs He has been paying tariffs on bicycles and imported parts he imported in 2018 in 2018.
He said: “The Trump administration is proud to say that China is paying tariffs.” “I always say, okay, if some people in China want to pay, I will be happy, but we have to pay.”
Most foreign products have received some tariffs when they enter the United States. The United States agrees to tariff restrictions on various products at different levels when joining the World Trade Organization. If foreign exporters are found to be engaged in unfair trade behavior, the US government will impose various other tariffs.
Nevertheless, the average tax rate in the United States is low, about 2.5 %, which is lower than the average tariff rate of other countries. The new tariffs proposed by Mr. Trump will be added above any existing tariffs.
Who ultimately bear the cost?
The next question is who will eventually bear the cost of tariffs. Importers can choose to absorb costs, but this will absorb its profits. Some importers say that paying a 25 % tariff will completely eliminate its profit margin and close it.
If the importer does not want to absorb the cost of the tariff itself, they can try to force the supplier to sell the goods to reduce the price to make up for tariffs. Or, they can pass the cost to customers at a higher price.
Each situation is different, depending on the company’s influence on other companies. If the importer is a large buyer of the product, it may force its supplier to eliminate the cost of tariffs. However, if this is a small enterprise ordering a small amount of goods, it may not.
Regarding Mr. Trump’s tariffs of hundreds of billions of dollars from China, several economic research found that most (if not all) this cost was passed on to American consumers.
Mr. Trump’s tariffs on foreign steel may be different. A paper in 2020 suggested that only half of these tariffs took effect for one year, and only half of the cost was transferred to consumers.
Mr. Kamler, Kamler, Kent International, said Mr. Trump’s tariffs on Chinese products forced him to increase the price. He said, “They say this is not inflation.” “This is not true.”
It seems a bad thing to pass the cost of tariffs to consumers. However, Wendy Edelberg, a senior researcher at the Bruckins institution, said that this is actually the core of the entire idea of tariffs.
Ms. Edberg said: “The purpose of tariffs is to increase domestic prices.” She said that the typical argument of levy tariffs is that American manufacturers cannot compete with cheaper import prices. Only in the case of health and benefits can we get health and profitability.
She said that the idea of increasing prices “involves the reason why tariffs are required.”
Some Trump officials believe that the increase in costs of consumers will be offset by changes in monetary value. Economists believe that imposing tariffs often strengthen the value of the US dollar. China may also depreciate its currency to deal with tariffs. This either changes will enable Americans to buy more foreign products at a price of one dollar, expand their purchasing power and offset the impact of tariffs.
However, if this happens, it will mean that foreign goods are for Americans, not domestic products, the former chief economist of Peterson International Economics, and the former chief economist of the International Monetary Fund Morris Obesfeld (Maurice Obstfeld) said. The government will obtain income from tariffs, but tariffs will not affect consumers’ purchase. At the same time, a dollar dollars will make our exports relatively expensive in other markets and damage exporters.
他说：“如果您认为关税被货币升值完全无效，那么您实际上并没有使进口更昂贵，因此您并没有真正影响贸易平衡或制造业。” “实际上，您正在损害贸易余额，因为您There is no increase in import price, and export is less competitive. “
How much will this cause family and economic losses?
Economists say that the company may transfer at least some of the costs of new tariffs to American consumers in order to maintain its profit margin.
The taxation foundation is estimated to be a think tank that is conducive to lower tax rates. In 2025, the additional cost of tariffs on Canada and Mexico has brought additional costs to American consumers at a price of more than $ 830. The move will increase the $ 958 billion burden team estimate to the Americans between 2025 and 2025, 2034.
These estimates do not include the additional expenses of the Trump administration-delete the so-called minimum exemption, which allows the goods to allow the goods to be exempt from the goods of less than $ 800. This change is particularly influential to products entering the United States from China, because this means that goods under $ 800 will be first tariffs by Mr. Trump in his first term.
Mike Short, a truck transport company that transports products across the country, said that the impact of tariffs on the industry is not like a change in the economy on the economy.
He said that even with new tariffs, “freight still needs to move, the production line still needs to run, and consumers still expect a complete shelf on the shelf.”
However, in the long run, economists expect that tariffs will drag the economy because consumers and companies are forced to reduce the purchase of foreign items with higher prices. The analysts of Goldman Sachs estimate that comprehensive tariffs on Canada and Mexico will lead to 0.7 % of the core price, and the total GDP in the United States will be reduced by 0.4 %.
Researchers at Peterson Institute of International Economics estimate that 25 % of tariffs will reach the most difficult for Canada and Mexico, but it will slow down economic growth and accelerate inflation around North America. In addition to China’s tariffs, the GDP of the United States will decrease by about one -third of the percentage point in 2027.
Mr. Trump believes that if there is pain, it will be worth it.
“Will there be some pain?” He wrote on social media on Sunday. “Yes, maybe (maybe not!). But we will make the United States great again, all of which deserve the price that must be paid.”
