Trump’s New Tariffs Will Cost The Average American Household $831 Annually
Trump’s most recent tariffs on Chinese goods will cost U.S. households $106 billion annually, or roughly $831 for the average American family, economists at the New York Federal Reserve estimate.
According to CBS News, the financial burden on American households comes from the Trump administration’s tariff hike from 10 percent to 25 percent on Chinese imports worth $200 billion, which was implemented nearly two weeks ago.
New York Fed assistant vice president Mary Amiti wrote in a blog post Thursday, "According to our estimates, these higher tariffs are likely to create large economic distortions and reduce U.S. tariff revenues.”
The $106 billion cost figure is comprised of two components: the additional tax payments from the tariffs and “deadweight losses,” or inefficiencies produced when firms source their imports from less efficient producers. The Fed researchers offered the example of purchasing products from Vietnam that had been made in China.
"Importers are induced to shift to ever more expensive sources of supply as the tariffs rise," they wrote.
Overall, the tax produced by the tariffs cost approximately $26.9 billion annually, or $211 for each U.S. family, and deadweight losses cost about $79.1 billion, or $620 for each household, according to the report. In all, households are shelling out $831 for Trump’s tariffs each year.