New tariffs could cost U.S. consumers billions
A new study has found that President Trump’s new $200 billion tariff proposal, on Chinese goods, would cost Americans billions a year.
NRF released a new study that found tariffs on furniture and travel goods from China would cost American consumers nearly $6 billion a year, resulting in the federation urging the Office of the U.S. Trade Representative to reject the tariffs.
“By now the administration should know something it questioned several months ago: Tariffs will not get China to change its unfair trade practices,” NRF Vice President for Supply Chain and Customs Policy Jonathan Gold said during testimony prepared for a USTR hearing this afternoon. “Instead, these tariffs threaten to increase costs for American families and destroy the livelihoods of U.S. workers.”
Gold cited a new analysis prepared for NRF by the Trade Partnership that found 25 percent tariffs on furniture from China would lead to American consumers paying $4.6 billion a year more for furniture even if retailers switched their sourcing to other foreign countries or U.S. furniture makers. Similarly, 25 percent tariffs on travel goods such as luggage and handbags would cost consumers $1.2 billion a year even if the goods no longer came from China. At 10 percent, the impact would be smaller but still significant.
In May, the Trump administration’s proposed tariffs on $50 billion of Chinese imports that would reduce U.S. gross domestic product by nearly $3 billion and destroy 134,000 American jobs, predicted by another NRF study. The study warns that imposing tariffs on an additional $100 billion of Chinese imports would come at a significant cost to the U.S. economy, destroying 455,000 jobs and reducing GDP by $49 billion.
Gold said the tariffs are particularly burdensome for small businesses, citing a recent NRF survey that found nearly half (46 percent) of small retailers anticipate a negative impact on their businesses due to proposed or implemented tariffs.
“The threat that these tariffs could be imposed, and even expanded to include all consumer goods imported from China, has already started a scramble among importers to find alternative sources of supply, including in the United States,” Gold said. “While you may think this is a positive development, the administration needs to know that the scramble is already bidding up prices for consumer products from all possible alternative manufacturers. Therefore, even if the administration decides not to impose the tariffs, higher prices are already on the horizon for American families.”
To read the full NRF report, click here.