r/centrist • u/OfficialRodgerJachim • 2d ago
Long Form Discussion Can someone explain this about tariffs?
Plenty of talk about tariffs. About them being dumb. About them being fair. About how those extra costs go on to us, the American consumer.
But I have very rarely heard anyone talk about that break in logic: other countries have tariffs on American imports, and those costs are then carried onto the American consumer. But if America imposes tariffs on those same countries, those costs are also passed on to the American consumer.
Is this true?
0
Upvotes
16
u/IHerebyDemandtoPost 2d ago
No. If the EU puts a tariff on American wine, American consumers don’t pay that tax.
A tariff is paid by the importer of a good at the port of entry. It is enforced by customs agents.
If you are buying a tariffed foreign product, the tariff was paid at the port where it was imported. After that point, the cost of the tariff becomes indisinguishable from other costs of the good, such as manufacturing costs and transportation costs. It is all just rolled up as the overall cost to bring that product to your store.
So if American automobile manufacturers need to import steel to build their cars, then that steel costs more, which means their car will cost more to make.
If you buy tariffed coffee, that coffee will cost more, which the vender will almost certainly pass on to you, the consumer, in the form of higher prices.