Trump is proposing massive new tariffs—or taxes on imported goods—that will drive up costs for Americans while hurting the overall economy. Despite Trump’s claims that foreign countries pay for tariffs, evidence from Trump’s previous tariffs shows that it was actually domestic importers and American families who faced higher costs after they took effect. If Trump actually imposes his proposed tariffs, economists expect they would cost a middle-class household thousands of dollars per year, and result in billions of dollars in losses for the national economy.
Trump has proposed a series of tariffs that would drive up costs for families.
Throughout 2024, Donald Trump has proposed a series of tariffs on all goods coming from outside the U.S. or on goods from specific countries. His recent proposals include:
- An across-the-board 10 percent tariff on all products imported from other countries.
- An across-the-board 20 percent tariff on all products imported from other countries.
- A 60 percent tariff—“or higher”—on all goods imported from China.
- An additional 10% above any additional tariffs on imports from China.
- A 25% tariff on products imported to the United States from Mexico and Canada.
Economists on the left and right agree: Trump’s tariff plans will raise prices on consumers, harm the economy, and will not achieve the goals that Trump claims they will.
Trump’s tariffs would cost consumers thousands of dollars per year.
- The Center for American Progress estimated that a 10% tariff on all goods imported to the United States and 60% tariff for all Chinese goods would cost a middle class U.S. household $2,500, while a 20% tariff on all imported goods and 60% tariff on Chinese goods would cost them $3,900 per year.
- The Peterson Institute for International Economics also finds that the 20% across-the-board tariff, coupled with a 60% tariff on Chinese goods, would result in a $2,600 annual loss for middle class families.
- Groups like the American Action Forum (AAF) and non-partisan consulting firm Ernst and Young (EY) are estimating losses in the U.S. economy, with AAF estimating a low of 0.16% in real Gross Domestic Product (GDP) losses, and EY estimating losses as high as 2.34% of real GDP—equivalent to $44.7 billion and $653 billion in end-of-year 2023 GDP terms, respectively.
Trump’s tariff plans would increase costs for goods that Americans rely on.
Prices for things ranging from smart phones to clothes to food are likely to increase.
- The United States imports 60% of its fresh fruits and 38% of its fresh vegetables, according to 2021 data, with a majority of those imports coming from Mexico, and 20% of imported vegetables coming from Canada. The Produce Distributors Association has voiced concern that prices will rise significantly as a result of the tariff.
- Something as simple as a $17 plush toy could increase to $27, and the price of $80 jeans could increase to nearly $100, according to the National Retail Federation.
- Trump’s proposed tariffs could also increase smartphone prices by 26%. For the newest version of the iPhone, this means the price could increase by over $200, and the cheapest version of the iPhone, sold directly by Apple, would be over $100 more expensive.
In his first term, Trump enacted tariffs on Chinese goods and on foreign steel and aluminum.
- Multiple studies have found that U.S. consumers paid for Trump’s last round of tariffs through higher prices.
- Trump’s tariffs also did not achieve their stated goal of bringing manufacturing jobs back to the United States. Instead, research shows either no change, or a decrease in manufacturing jobs as a result of Trump’s tariffs.
- Trump’s tariffs caused a trade war between the U.S. and China which, research finds, led to a loss in U.S. agricultural employment, as well as a loss of employment in the transportation and warehousing sector and the business services sector.
- Trump’s 10% tariff on all goods and 60% tariff on Chinese goods would affect almost 10 times the value of goods Trump targeted with his 2018 and 2019 tariffs.
Trump’s tariffs could harm local economies across the country.
JEC analysis has found that multiple state economies are heavily dependent on trade for statewide business. Two lists of the top ten states where GDP is most dependent on trade, and where GDP is most dependent on imports, are provided below. In addition, states like New Mexico would be especially harmed by tariffs on imports from Mexico given the integrated, cross-border supply chains for things like cars, computers, and other electronics.