(Reuters) – John Hamer, president of Rodgers Wade Manufacturing in Texas, manufactures stores accessories for large retailers like Ross Dress for Less and Ulta Beauty.
It matters many products from China, which, until recently, said it paid 70% in metal components rates.
“The media was saying it was 30%, but that was never true,” he said, referring to the tariff to China announced in May as part of a truce between the Trump government and Beijing while negotiating a broader deal.
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This is because the 30% Hamer rate has been accumulated over existing tariffs, including one on Chinese steel products that varies according to the amount of steel used in a component.
When US President Donald Trump adds a new fare, the old ones do not disappear. Some companies will pay more due to a so -called “stacking” of tariffs.
The reality for many US companies is that their tariff expenses are often much higher than the figures presented in commercial negotiations.
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Tariff stacking applies to any US exports to the US, but the most extreme cases tend to be like China, where the US has accumulated a long list of fares broken according to different provisions of US commercial law.
The last turn was the announcement that both sides agreed with a 55%rate, but this is partly just an estimate of the average pre-existing tariffs. Hamer is not sure what will be the total of his fares now, but he thinks it could not be much worse.
“We hope this reduces the number (of tariffs) and that some of the customers who were standing would order,” he said, “because the situation is very complicated.”
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Many companies are still awaiting a breach of President Donald Trump’s trade war. Federal courts, including the US International Court of Commerce, have ruled that Trump’s imposition of tariffs exceeded their authorities. A Federal Court of Appeals is analyzing the government’s appeal against this decision, and the daily rates remain in force while it happens, a process that should take months.
Some account exemption accounts, a popular tool used by companies during the first Trump administration to get imported products without tax.
Michael Weidner, president of Lalo Baby Products in Brooklyn, is one of them. “We believe there should be a permission for baby products,” he said. “The same goes for toys.”
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The Trump government said it will resist the creation of exemptions and, even during the last trade war, was a complex process. For example, Lalo imports a “game table” from China that is included in a customs category subject to a 25% rate according to a part of the trade law aimed at combating unfair business practices. Therefore, Weidner is paying 55% rates on them due to stacking.
Trump campaigned promising to use tariffs to bring production back to the US back and raise recipes to help finance a large tax cut. Its debate with China quickly turned into trade war, with the United States imposing a widespread 145% tariff that has closed much of the trade between the two largest economies in the world.
