Where Trump’s new China tariffs will hit consumers

Author: CBS News
Published:
FILE – In this July 8, 2017, file photo, U.S. President Donald Trump, left, and China’s President Xi Jinping arrive for a meeting on the sidelines of the G-20 Summit in Hamburg, Germany. Trump is planning to sign an executive action asking the U.S. Trade Representative to consider investigating China for the theft of U.S. technology and intellectual property. He is taking the step even as he seeks China’s help with the ongoing crisis with North Korea. (Saul Loeb/Pool Photo via AP, File)

American consumers may feel President Donald Trump’s trade war more keenly in their pocketbooks as soon as next week.

The White House late Monday released a statement from Mr. Trump imposing new tariffs of 10 percent on $200 billion in Chinese imports beginning Sept. 24 and expanding the levy to 25 percent beginning Jan. 1.

China retaliated on Tuesday, announcing its own tariffs on $60 billion in U.S. goods. That could spur the Trump administration to carry through with its previous threat to tax all imports from China, the U.S.’s biggest trading partner last year.

The tariffs under this new tranche include all but 300 items that were originally proposed by the Office of the U.S. Trade Representative before it held hearings seeking public comment about them over the summer, according to a statement from the USTR.

The U.S. has already slapped $50 billion in tariffs on China, along with those on steel and aluminum. Monday morning, Mr. Trump kept up his offensive against Beijing, tweeting that his tariffs are working, something most companies and economists disagree with.

The China tariffs could be a “big blow” to U.S. consumers, the Peterson Institute for International Economics outlined in a report this summer. The USTR’s Sept. 18 list includes computers, furniture, seats, lamps (lighting and parts), travel bags, agricultural and food products, vacuum cleaners, cooking appliances and refrigerators among other products.

Among the 300 items left off the list are some Apple products and some consumer products, like bicycle helmets and child safety seats. Apple earlier this month appealed to the USTR to rethink putting some of its key products on the target list. Mr. Trump shot back, suggesting Apple move some plants to the U.S., but for now at least it appears Apple has avoided the hit many other companies will suffer.

Here are some areas where critics of the tariffs say American consumers will see higher prices:

Shampoo, dog leashes and refrigerators

The National Retail Federation earlier this month sent a letter objecting to the tariffs to U.S. Trade Representative Robert Lighthizer, saying consumers would pay higher prices on products ranging from shampoo to dog leashes and refrigerators to bicycles, fish, fruit and nuts.

“These are products purchased by nearly every American household,” David French, a lobbyist for the industry group wrote in the letter. “Many are staples, and account for relatively large shares of total household spending of lower-income households (food, beverages, personal care products, appliances, for example).”

Goody hair ties

Goody Products, a division of Newell Inc., said in a letter to the USTR that it’s “simply not a feasible option” to shift production of its hair ties from China. Typically retailing for between $1 to $10, the ties are sold in bundles.

Tariffs could result in a 40 percent price hike if implemented at 10 percent and more than double if at 25 percent, the company wrote.

That “may not seem to amount to much but every penny counts to American consumers who use this product every day,” wrote Kim Hoelting, general manager for Goody Products, in the letter.

Trek bicycles

Trek, based in Waterloo, Wisconsin, is one of dozens of bicycle-related companies that wrote to object to the levies. Tariffs of 25 percent have already hit the industry, Robert Burns, Trek’s senior legal officer, wrote in a letter to the USTR earlier this month. The new tariffs would cost Trek more than $30 million each year.

“Across the US economy, these costs will inevitably be borne by the American consumer who will pay more, and by those employees who will lose their jobs as a result of these punitive and ineffective tariffs,” Burns wrote.

Under the final tariff list, some helmets used for safety aren’t subject to the levies, but bicycles remain targeted.

Smart technology in your refrigerator, vacuum and TV

The Consumer Technology Association recently said a study it commissioned showed tariffs on printed circuit board assemblies and connected devices may mean price increases of as much as 6 percent, even for U.S.-assembled products, and cost American shoppers an extra $3.2 billion each year.

“American shoppers will have to pay between $1.6 billion and $3.2 billion more for connected devices such as gateways, modems, routers, smart speakers, smartwatches and other Bluetooth enabled products,” the CTA said last month. “The price of connected devices from China will increase by between 8.5 and 22 percent. And prices for these products from all sources will rise between 3.2 and 6.2 percent.”

On Monday, the CTA said in a statement it found the latest round of tariffs “legally questionable.”

Your canned tuna fish sandwich

The tariffs would increase prices for canned tuna, among other seafood products, wrote Chicken of the Sea Chief Executive Valentin Ramirez in a letter to the USTR.

It’s impractical to move seafood suppliers from China, and too expensive, he wrote, noting that canned and processed seafood sellers already have low margins. Chicken of the Sea “cannot absorb the costs of tariffs and must pass them on to consumers,” Ramirez wrote.

That will hurt sales, no matter how small the increase appears, he said. El Segundo, California-based Chicken of the Sea is already dealing with higher prices resulting from the steel and aluminum tariffs Mr. Trump imposed earlier this year, Ramirez wrote.

“This is about more than just numbers, because increasing the costs of our products harms our nation’s most vulnerable consumers. COS’s products are an essential part of an affordable and nutritious diet for millions of Americans,” Ramirez said in the letter.

Some kinds of furniture for babies and toddlers

Delta Enterprise, a New York-based maker of wooden baby furniture that supplies Walmart, Costco and others, would be forced to charge more because the materials to make cribs would become more expensive under the tariffs, lawyers for the company wrote in a letter to the USTR.

A 25 percent tariff could boost the price a $200 crib to $250 or $300, “making it more difficult for families of modest means to afford such a crib,” the letter said.

Higher prices for cribs may mean customers instead turn to cheaper or less-safe versions, Delta’s letter noted, putting infants at risk of injury or death.

Some high chairs, booster seats and child lifts, including those made of wood, were among the 300 items left off the final list and aren’t subject to this round of tariffs.

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