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The week's question
In March 2025, in the thread "Re: OT, out", Umm asked the members: "Do you think it is because America is made up of magical soil that makes businesses based in America magically profitable?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Author: ptheland ✭✹🐝  😊 😞
Number: of 86258 
Subject: Re: Tariffs and (are) hidden taxes
Date: 07/30/25 3:36 PM
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The most likely outcome is that each of these four parties will pay at least some portion of the tax.

Let's not forget the original intent of tariffs: To allow producers of competing alternative goods to charge more for their product. As you correctly note, a tariff will increase the price of the taxed goods. How much or little that price changes depends on a lot of factors, but ultimately, the price of the good will go up.

That price increase allows domestic (or non-tariffed foreign) producers to increase their price - or at least sell more of their goods at an unchanged price.

So the actual cost to consumers is likely to rise not only from the increase in price due to the tariff, but also to price increases (or higher availability) of goods free of the tariff/tax. Consumers not only pay a higher price for the taxed goods, but may be forced to pay higher prices for alternative goods as well.

--Peter
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This community has written 86,214 posts about US Policy. The article-length ones it recommended most:
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