U.S. President Trump announced Thursday that he would impose import tariffs on another $300 billion of Chinese goods, which would impose tariffs on almost all Chinese imports to the United States. Trump said the tariff measure has enabled the U.S. Treasury Department to generate billions of dollars in revenue from China.
But tariffs don't work that way. The Chinese government and enterprises do not directly pay for tariffs. Tariffs impose taxes on imported goods. Registered U.S. enterprises are required to pay U.S. Customs duties on their imports into the United States.
Importers usually pass tariff costs on to their customers, American manufacturers and consumers, through price increases. American business executives and analysts say that American consumers will bear most of the tax.
As soon as Trump announced his tax decision, American retailers immediately attacked the move as "another tax increase on American businesses and consumers", warning that it would threaten American jobs and increase the cost of American households.
The new tariff will affect a wide range of consumer goods, from cell phone batteries and laptops to toys and footwear.
Stephen Lamar, executive vice president of the American Association of Garments and Footwear, said the new tariff measures had a far greater impact on American consumers than on Chinese manufacturers. Forty-two percent of the clothing and footwear purchased by Americans are made in China and 69 percent are made in China.
Investors fear that rising retail prices will hit consumer spending that underpins the U.S. economy, while trade uncertainty will curb corporate capital spending.
Hot Model No.: