ROANOKE, Va. (WFXR) – President Donald Trump announced over the weekend a 25 percent tariff on all Canadian and Mexican imports, and a 10 percent tariff on Chinese imports, in an attempt to end the countries’ production and exportation of fentanyl to the United States.
Since then, modifications and delays have been made to the tariffs, and it’s still unclear when these might kick in, or if the countries will make deals to avoid them.
Trump has talked about tariffs for years, and it’s a complex issue, so we asked Thomas Duncan, an associate professor of economics, to break it down.
“Tariffs in general are a tax on incoming goods from a different country,” he said. “Any time a good is crossing the border, it’s going to cost 25 percent more, and the revenue from that extra 25 percent for every good that you purchase then goes to the government.”
Then, companies often pass those added costs onto consumers.
“Because those prices are now higher, it will allow some US producers or sellers of the item to charge more because the competition is now lower,” Duncan said.
That, Duncan said, can hit us in the wallet.
Car buyers might see higher sticker prices in a few months down the road, but the tariffs would have much quicker impacts on our day-to-day necessities.
“If you think about a grocery store, and we tariff things that were going to go into the grocery store, well the grocery store, understanding its own market, might know what you would be willing to purchase for various things,” Duncan said. “If they think you’re not going to meet those price points, they’re not going to stock them as much.”
Trump said the goal is to stop enriching foreign countries and start enriching Americans, but admits all of us may feel some pain if the tariffs go through.