Tariff Resources

Tariffs are levies or duties that a government imposes on goods imported from other countries.

According to Rodney Sullivan, executive director of the Mayo Center of Asset Management at the University of Virginia’s Darden School of Business, “Tariffs directly affect the price of imported goods, which can lead to higher consumer prices and can alter trade dynamics and international relations. They are also used to indirectly protect domestic industries by making foreign products less competitive. So, in addition to being a source of revenue, they can protect domestic industries, counteract unfair trade practices and act as leverage in negotiations.” [Source] 

President Trump is threatening to impose tariffs as part of his concerns about reducing the flow of fentanyl into the U.S. and fighting illegal immigration. He is also a strong proponent of tariffs to reduce the trade deficits between the United States and other countries, which he believes harms American manufacturing and jobs. . Notably, the new tariffs against China are on top of previous tariffs he enacted during his first administration.

The Constitution gives power to impose taxes, lay duties, regulate foreign commerce to Congress, and none to the president. However, as tariffs’ role in funding government operations has shrunk, Congress has granted the President the power to impose tariffs under certain extraordinary situations through a series of trade laws. For these tariffs, President Trump declared an emergency under the International Emergency Economic Powers Act of 1977 (IEEPA). The U.S. Congress has the ultimate authority to override the President’s tariffs but must pass a a joint resolution so to do. 

Tariffs are paid for by the importing entity, in this case U.S. businesses. Foreign countries and their companies do not directly pay the tariffs.

The additional tariffs on China, Canada and Mexico reportedly include a provision that will eliminate a longstanding rule that allows small packages destined for individual use to enter the U.S. without a paying a tariff. This rule — the “de minimis” exemption that applies to packages worth less than $800 — is commonly used by Chinese eCommerce retailers to sell goods at lower prices by shipping them directly to consumers in the U.S., Bloomberg reported Saturday (Feb. 1). This exemption does not impact the food industry but instead tends to capture apparel and household goods.

Much of the food imported into the U.S. cannot be produced domestically because of climate conditions or crop seasonality. Currently, the U.S. imports approximately 17% of all food and beverages consumed by Americans, according to the USDA. But this varies dramatically within certain categories. For example, more than 40% of vegetables and melons, and more than 50% of fruits and tree nuts are imported. As two of our largest trading partners, a significant portion of these imports come from Canada and Mexico, including grains like oatmeal as well as fruits like strawberries and vegetables like bell peppers and tomatoes.

According to the USDA, in 2023, the United States imported more than 20 million metric tons of agricultural products worth more than $40 billion from Canada. Similarly, more than 16 million metric tons of agricultural goods worth more than $45 billion came from Mexico.

Some of the largest categories of product imports from Canada include grains ($9 billion), oilseeds ($8 billion), food grade oils ($6 billion), vegetables ($5 billion) and cocoa ($2 billion). 

According to the Peterson Institute for International Economics, the direct cost of a 25 percent tariff for most goods from Canada and Mexico, a 10 percent tariff on Canadian energy imports and an incremental 10 percent tariff on Chinese imports to the typical, or median, U.S. household would be a tax increase of more than $1,200 a year. [Source]

At this time, all products coming into the United States from Canada, Mexico, and China would be subject to the proposed tariffs – whether raw materials, finished goods, or anything in between.

If companies can demonstrate through documentation that their goods have already left their port of origin and are en route to the United States before the tariffs enter into effect, those items should not be subject to tariffs. However, companies may need to work with U.S. Customs and Border Control to secure relief. Anything shipped after the date that tariffs go into effect would be subject to the increased import duties.

Yes, the President had already threatened Columbia, and negotiations with Mexico and Canada are in the works over the next 30 days. The President said that he will wield tariffs across multiple countries, including the EU.

Due to contractual obligations with pharmaceutical companies and pharmacy benefits managers, retailers cannot increase the cost of pharmaceuticals at the point-of-sale to make up for their higher acquisition costs. These tariffs will further burden struggling pharmacies and exacerbate pharmacy access issues in communities.

There is currently not an exemption process for any of the goods covered under the proposed tariffs, so all products remain subject at this time. A trade group representing generic pharmaceutical companies urged the Trump administration to exempt generic products from tariffs, adding that the overall value of all generic sales in the U.S. has decreased by $6.4 billion in five years despite “growth in volume” and new generic drug launches.