A study by the Kiel Institute for the World Economy has concluded that U.S. tariffs imposed under President Donald Trump have been passed almost entirely onto American importers and consumers, with foreign exporters absorbing only around 4% of the cost. Based on analysis of roughly 25m transactions worth about $4tn, the researchers found a 96% “near-complete” pass-through of tariff costs to U.S. buyers, arguing the duties function more like a domestic consumption tax than a levy on foreign producers. The study highlights Brazil and India as examples where exporters did not materially cut prices after steep U.S. tariff increases, with the adjustment instead occurring through reduced trade volumes rather than price concessions. Relatedly, the Trump administration would enact new tariffs almost immediately if the Supreme Court struck down sweeping global tariffs the president launched under an emergency law, U.S. Trade Representative Jamieson Greer had told the New York Times. He told the Times that the administration would “start the next day” to replace the tariffs with other levies, saying: “The reality is the president is going to have tariffs as part of his trade policy going forward.” Greer nevertheless expressed optimism that the Supreme Court, which is currently reviewing the president’s use of an emergency law that underpins most of his tariffs, would rule in the administration’s favor.
