-The president has made tariffs the center of his economic policy
-Tariffs are usually passed on to the consumer in form of higher prices
-Inflation has already increased since Trump took office
President Donald Trump announced reciprocal tariffs Thursday, continuing to make good on a campaign promise to enact tariffs on imported goods.
The president said sending merchandise through another country to avoid tariffs will not be allowed and provisions will be made for nonmonetary tariffs, like tests on cars. Those will include limitations on trade.
Trump said the system would bring fairness back when it comes to trade, though tariffs have historically raised prices for consumers and contributed to inflation.
He said the tariffs would be customized based on individual nations and their policies, including any tariffs they impose on U.S. goods, value-added tax and cost to U.S. businesses from nontariff sources, like stricter regulatory requirements.
The administration said countries with the highest trade deficits with the U.S. would be the first targeted with tariffs and that it will move to rapidly institute tariffs.
There is the potential for tariffs to be reduced if other countries take action to adjust their own trading policies.
Trump said there will also be tariffs on cars and pharmaceuticals coming soon.
Trump has already made tariffs a major element of his economic policy despite warnings from economists that tariffs will increase inflation and harm American consumers.
Trump has already levied a 10% tariff on China and put a 25% tariff on aluminum and steel, with some exemptions for trading partners. China, in response, put tariffs on an array of American goods, with impacts disproportionately targeted toward areas that voted for Trump in the election.
He also proposed 25% tariffs on goods from Canada and Mexico but paused both tariffs after the countries agreed to take action toward controlling the borders. The pause is set to end in March, raising the possibility the tariffs will go into effect then.
Canada has already threatened to take action in response to tariffs, with sellers previously pulling American alcohol from shelves and catalogs in response to the initial announcement.
While Trump has described tariffs as a tax on foreign companies, the tariffs are paid by the importing company, and economists say the cost is usually passed on to the consumer.
The move is likely to raise the price of goods when Americans are already struggling. Trump has admitted there will be economic pain associated with the policies.
Already inflation, which had been trending downward, has increased since Trump took office.
-NewsNation
