Tariffs costing U.S. importers bigly–$3.4 billion in June alone

  • As the trade war with China heats up, U.S. importers are already paying a bigger bill, according to calculations from a coalition of business groups called “Tariffs Hurt the Heartland.”
  • $3.4 billion of $6 billion in tariffs collected by the U.S. in June are from new duties imposed under President Trump
  • More taxes on goods from China, paid for by U.S. importers and deposited into the U.S. Treasury, are slated to be imposed Sept. 1. 

President Donald Trump’s trade war with China may be heating up, but it’s also burning a hole in the income statements of U.S. importers of overseas goods. 

U.S. companies paid $6 billion in import tariffs in June, a 73% increase from June 2018. About $3.4 billion of that total comes from new tariffs imposed by President Donald Trump in the past year, including those on imports of Chinese goods, according to calculations from “Tariffs Hurt the Heartland,” a coalition of businesses and associations.

The figures, compiled from U.S. Census Bureau data to discern taxes imposed under Mr. Trump’s administration, are the first from a month to include the most recent round of tariffs imposed on Chinese imports. Those taxes were raised in May to 25% from 10% on about $200 billion of largely industrial goods from China.

Dow Jones plummets amid U.S. trade tensions with China

The values tracked for June don’t include a new round of tariffs of 10% on virtually every remaining consumer product imported from China to the U.S., or about $300 billion worth of products, slated to take effect Sept. 1. That move would mean the average tax on imported Chinese goods would be more than 20%, according to a recent estimate from the Peterson Institute for International Economics. 

Trending News

And this time, consumers are more likely to feel the pinch, as the September list includes popular items like smartphones, clothing, footwear, food, electronics and books, including the Bible.

U.S. companies, not countries like China, pay tariffs

“Americans are already paying record-high tariffs, and the biggest hit to consumers is still to come on September 1,” Tariffs Hurt the Heartland spokesman Jonathan Gold said in a statement

Contrary to what Mr. Trump erroneously and repeatedly states in tweets, companies that import goods and services pay the tariffs to U.S. Customs and Border Protection, not countries like China. The proceeds wind up in the U.S. Treasury, and companies either absorb the cost or pass some or all of it to customers. 

In total, new tariffs imposed under Mr. Trump have added $27.2 billion to the Treasury, with more than 75% of that coming from the taxes that U.S. importers pay on Chinese-made goods, the Tariffs Hurt the Heartland group calculated with the help of a Washington-based consulting firm called the Trade Partnership. 

Tariffs offset by farm subsidies

Still, Mr. Trump’s tariffs have been offset by roughly $28 billion in government aid promised to American farmers whose sales have been crippled or blocked by China’s retaliatory moves in response to the U.S. tariffs. That includes $12 billion in aid announced last year and $16 billion announced in May. 

Farmers fear impact of escalating trade war with China

Recent research suggests that for Chinese imports subject to tariffs so far, American consumers and businesses are taking the biggest hit in the form of higher prices and costs. In May, a study from the Federal Reserve found that tariffs in effect could cost the average family $831 a year.

Customs duties collected in the fiscal year that started last October currently total $50 billion, up from $28.3 billion for the same 10 months in 2018, according to recent U.S. treasury data. That pace puts the U.S. on track to collect $72 billion annually, the Wall Street Journal noted today. 

That $72 billion projection may seem like a lot, but it’s just 0.4% of the $20 trillion U.S. economy, still the world’s largest. 

The White House last year began imposing tariffs on imported goods under decades-old trade statutes, including the duties on Chinese goods under what’s known as Section 301 of a 1974 trade law. 

Categories: National, US & World News

Leave a Reply

Your email address will not be published. Required fields are marked *