Report: Americans Bear 96% of Trump's Tariff Costs

“Contrary to US government rhetoric, the cost of US import tariffs is not borne by foreign exporters,” the Kiel Institute for World Economy – an independent nonprofit group – said in a report. The report said US revenue from tariffs is projected to grow by approximately US$200 billion by 2025, and that foreign exporters bear only about 4% of the tariff burden, with 96% passed on to US importers and consumers. Last month Trump told reporters at the White House, “Because of the tariffs, we’ve taken in more than 18 – think of this – more than US$18 trillion. There’s never been anything like it.” Last week, at the Detroit Economic Club, he said the tariffs had “helped curb inflation”. Yet the report stressed that while the US administration aims to target foreign companies with tariffs, this policy actually harms the domestic economy. The report said the tariffs act like a type of consumption tax on imported products, leading to a decrease in the variety and quantity of products on the market. It added that these findings mean that in the long run, US companies will see narrower profit margins, consumers will face higher prices, and countries exporting to the US will see fewer sales and be under pressure to find new markets. “The tariffs are an own goal,” said Julian Hinz, Kiel’s research director. “The claim that foreign countries pay these tariffs is a myth. The data show the opposite: Americans are footing the bill.” The report analysed over 25 million shipment records with a total value of approximately US$4 trillion.