Since his return to power, Donald Trump has intensified the trade war by imposing tariffs on a wide range of imported products. The stated goal is multiple: raising federal revenue, reducing commercial deficits and forcing companies to produce more within the United States. But in practice, the impact falls on importers, local industries and consumers, according to a report by The New York Times.
Tariffs act as applied overwhelms on foreign goods. Who initially pays the companies that import these products, passing the amount to the US Treasury Department.
Only in the first 11 months of the current US fiscal year, which ends in September, the government raised $ 165 billion with customs rates, more than double the one registered in the same period of the previous year.
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The effect, however, does not end in the collection. Great importers, like Walmart, face difficult decisions. When buying $ 100 in Vietnam shoes, subject to 20%fare, the retailer needs to pay $ 20 extras in taxes.
This cost can be negotiated with suppliers, absorbed by the profit margin itself or fully passed on to the end consumer. Generally, the solution involves a combination of the three options.
For Trump, the logic is that heavy tariffs discourage production abroad and encourage factories to settle in American territory, creating jobs and raising wages. In addition, the president sees in the extent a negotiating weapon with other countries and a way to boost internal revenue to finance tax cuts.
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Economists heard by the newspaper, however, point to contradictions. The same rates that could boost domestic industry also make inputs more expensive and disorganize global supply chains, making life difficult for American manufacturers.
The result is a complex equation: increased revenue for the treasure, but also cost inflation, diplomatic tensions and uncertainties for companies and consumers.
