Tariffs imposed on imported household items like shoes and clothing could be forcing you to pay as much as three times the value of what they’re worth, a new study recently revealed.
While the cost of tariffed shoes and sneakers at the borders is $100 billion, U.S. consumers paid $338 billion for the same items in 2010 according to study called “The Rebirth of Pro-Shopper Populism” published by the Progressive Economy, Bloomberg first reported.
Here’s a chart from the report showing how tariffs on low-end shoes and other mass market items compared with those imposed higher quality imported products:
|Shoes||8.5% (leather dress)||20% (trail running shoes)||48.0% (sneakers under $3/pair)|
|Sweater||4.0% (cashmere)||17.0% (wool)||32.0% (acrylic)|
|Man's shirt||0.9% (silk)||19.7% (cotton)||32.0% (polyester)|
|Drinking glass||3.0% (over $5 apiece)||22.5% ($0.30-$3 apiece)||28.5% (under $0.30 apiece)|
|Brassiere||2.7% (silk)||none||16.9% (polyester)|
|Handbag||5.3% (snakeskin)||10.0% (leather)||16.0% canvas)|
|Pillow case||4.5% (silk)||11.9% (cotton)||14.9% (polyester)|
|Spoon||3.3% (sterling silver)||4.2% (silver-plated)||14.0% (stainless steel)|
|Necklace||5.0% (gold)||6.3% (silver)||11.0% (silver- or gold-plated)|
|Blanked||0.0% (wool/cashmere)||8.4% (cotton)||8.5% (polyester)|
In the case of shoes, a pair of cheap sneakers is worth about $5 per pair, according to the report. That figure takes into account both costs of production and the fee paid to shipping companies that bring the products overseas from China and other Asian nations.
Once the shoes reach the United States, tariffs and other fees continue to bump the costs of these products. For example, the tariff would add about $2.80 to the costs that take the form of retailer markups. Then, state and local taxes continue to tack on additional fees to the costs of the shoes. When all is said and done, the price of those $5 sneakers has now been raised by $9 a pair as a result of tariffs and other taxes and fees.
The U.S. Takes on Tariff Reform:
The push to eliminate tariffs has been taken up on two fronts: one aimed specifically at shoe tariffs and another targeting tariffs imposed on outdoor clothing. Versions of both the Affordable Footwear Act and the U.S. OUTDOOR Act are working their way through Congress and could provide U.S. consumers relief as early as this fall. Both bills would target items subject to tariff rates of between 20-60%.
“Home-goods tariffs are no longer an import-management and job-protection tool. Instead they are simply a way to tax to teenagers in 10 shopping malls, single moms, outdoor enthusiasts, and low-to-middle-income families in general,” the report stated.
Click here to read the full report.