Trump's proposed tariffs could cost US households $1,500 a year: Report



AP24077687499756 e1711547260837

A blanket 10 percent tariff on imported goods floated by former President Trump could cost U.S. households around $1,500 a year, a new economic analysis has found.

Trump, who is on track to clinch the 2024 Republican presidential nomination, has pledged to impose a 10 percent tariff on all foreign products if reelected.

Broken down by sector, the tax on imports would translate to an additional $90 per year spent on food, $120 on oil, $220 for automobiles, $70 for clothes, $80 on electronics, and $50 on furniture and appliances, according to the analysis from the Center for American Progress, a left-leaning Washington think tank.

“Middle-income U.S. households—those in the 40th to 60th percentile of the income distribution—consume about 85 percent as much as the average household according to the Consumer Expenditure Surveys, which suggests a roughly $1,500 tax increase for the typical household,” the group said in its report.

Trump’s campaign has described his tariff as a key feature of their economic strategy, centered on domestic manufacturing.

“President Trump’s tariff plans will be the linchpin of a new Strategic National Manufacturing Initiative that will rebalance the global trading system and dramatically strengthen America,” Trump’s campaign said last year.

The CAP study says the Trump tariff would be more detrimental to U.S. consumers and importers than to Chinese companies.

“Tariffs are a tax levied on U.S. importers when their purchased product crosses into the U.S. market. These importers are usually domestic companies that import products for distribution to U.S. consumers,” the study says.

The study notes that there aren’t any Chinese companies in the top ten U.S. importers, as measured by the American Journal of Transportation.

Other progressive policy organizations have also taken issue with what they see as a misconstrual by Republicans of how tariffs work.

“Despite what the President says, it is almost always paid directly by the importer (usually a domestic firm), and never by the exporting country. Thus, if the US imposes a tariff on Chinese televisions, the duty is paid to the US Customs and Border Protection Service at the border by a US broker representing a US importer, say, Costco,” Howard Gleckman of the Tax Policy Center wrote in 2018.

Tariffs are currently a small source of U.S. revenues, accounting for just 1.7 percent of annual federal income in fiscal year 2024.

Both Trump and Biden have placed domestic manufacturing at the center of their economic agendas during their 2024 campaigns, and both presidents have pursued more protectionist policies than past presidential administrations.

Copyright 2024 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.



Source link

About The Author

Scroll to Top