Ok As someone who has studied economics, I wanted to know what the esteemed members of clutch fans know about Tariffs Who pays the cost ? Please feel free to use the Internet to help you research and don't be afraid to cite your sources
From what I understand The Domestic Producer/Purchaser will pay the Tariff Since they don't like that . . they will Pass the Cost to the Domestic Consumer i.e. Something cost domestic producer 4$ and they Sell it for 5$ for a 1$ Profit NOW with the Tarriff is still cost 4$ Plus the Tarriff 1$. .. so the Domestic producter is paying 5$ . . .. and they sell it to the customer for 6.50$ because. . . they can not blame the extra 1.50 on Tarriffs because they ARE NOT getting less than their 1$ profit Rocket River
Whoever pays the government pays the tariff. It’s just that simple. Everything in the price is part of the cost of doing business. The cost a customer pays for a good includes dozens of sub line items and we don’t go into this ridiculous argument breaking these costs down and the tariff is just one of dozens.
We probably would if one of those inputs could vary 50% based on the whims of one individual. If I placed a tax on gas for 2$ and the price went up 1.99$ you wouldn't say that the companies paid the tax , you would say the burden fell on the consumer .
If Tariffs only hurt a countries own citizens, why does every country threaten the United States with reciprocal tariffs? They will just be hurting their own citizens no?
I will make a few points. Its of my opinion the tariffs are being used to sew discord and chaos. For the end consumer, a tariff is nothing more than a national sales tax on selected goods. We do not pay state taxes on grocery food but we do on nearly everything else and nobody is confused about this process ... anymore than they should be on tariffs. 1) Buying a consumer tariffed item (amazon item for example) has a different impact than a company who buys tariffed raw materials. Negations are going to be very different buying 10 million in aluminum machined items to be used in assembly in the united states than someone buying a consumer package directly from china (even if Amazon is being used as the distributor). There is no negotiating for the person buying off amazon, but the company buying 10 million in machined goods could have the chinese vendor agree to pay 50% of the tariff directly. It doesn't matter to the end user. 2) As a consumer, I could opt to buy a $2,000 item directly from china and have it shipped to me vs paying for the item with a 100% tariff from Amazon now costing me $4000.00. Now when that directly purchased item hits customs, customs will hold your $2000.00 item until you pay the $2000.00 tariff. In this case, the consumer pays for the tariff because they are writing the check to the government. 3) As the end consumer, how a company processes their accounting is completely irrelevant to me. If the company gets hit with a tariff, its the companys problem, not mine. The company offers me the product at $x.00 amount and I really don't care how they came to that amount as long as me and the company comes to an agreement on the price. We don't sit around quibbling over every line itemed cost and who is 'technically' paying for all the continued increased costs of the product. Debating over who actually pays for the tariff is mind numbingly dumb. Of course it drives up the cost of goods and someone, somewhere, will take the hit, whether its supplier in discounts, the shareholders in loss of revenue or the customer in increased price of goods or employees who receive smaller increases in wages or other creative accounting ways to distribute those losses. The macro debate on tariffs is much more interesting and completely theoretical as there is no group of people who can accurately predict how the global economy as a whole will react. There is massive arbitrage opportunity through the entire economy. The question was "Who pays for the tariffs". The answer remains the same. Whoever writes the check to the government. I don't pay state sales tax. It just gets line itemed on the receipt.
I don’t have an economic degree and I don’t like to google, but I took some classes at the now defunct Trump University. In the US, a tariff is a tax imposed directly on importers. So, who pays for this artificially created inefficiency? Ultimately, everyone involved in the chain from production to consumption. Why would anyone sensible, then, want to introduce such inefficiency? To protect domestic production. To shield a new industry until it’s mature enough to compete. For national security. Those are somewhat sensible. How about across the board blanket tariff?? Who knows, right? It’s too complex. The impact of a blanket, across-the-board tariff is not 12th-dimension calculus. We have real-world examples and historical examples to stand on. But my now defunct degree tell me it’s too complex and we should just sit back and enjoy the ride.
Incorrect. It can be 100% on the consumer or it can be distributed across the entire economy. like almost anything.
