In recent months, US President Donald Trump has announced several new tariffs, declaring that these will boost the US’s economy by promoting American manufacturing and protecting American jobs. However, these tariffs have created economic chaos, with many US products having increased prices over the past few weeks. This is because the US is no longer an isolated economy but is now a part of a global economy, depending on other countries to produce our goods. Many Americans now worry about their day-to-day expenses and are confused about what these tariffs mean for them and their families.

What are tariffs? 

To put it simply, tariffs are taxes. These taxes, however, are on goods being imported from other countries. They are measured in percentages, meaning a 20% tariff on a $10 item would have a $2 tax, bringing to total to $12. These taxes are paid to the government by companies that bring foreign goods into the US. While tariffs do not mandate that a company raise the price for consumers, that is often the case. This is because the company still needs to earn a gross profit to function. In some cases, the company may decide to import fewer goods altogether. 

What are some tariffs Trump has announced? 

China: 

China is one of the top import partners for the United States. On February 4th, Trump announced a 10% tariff, which he would later change to 20%. On April 9th, he increased the tariffs to 145% for most goods, with some exceptions facing a 245% tax. China is facing higher tariffs on goods imported to the United States than ever before. 

Cars: 

Beginning April 2nd, cars faced a 25% levy; however, on April 29th, these were softened to aid US car companies. 

10% “Baseline” Tariffs: 

On April 5th, Trump announced a baseline 10% tariff on all goods imported from most countries, including the UK. Later, he revealed a higher tariff on 60 more countries, which he deemed the “worst offenders” of America’s trading partners. Later that day, however, he announced a 90-day pause where the 10% baseline tariff would be paid by all countries except China. 

How does this affect US consumers? 

Prices of imported goods are expected to increase dramatically, since the businesses are often passing on some or all of their higher costs. Another expected impact is less availability of foreign products, causing those that are available to increase in price.