Email This Post Email This Post

Retailers Tell President Trump They Pay Tariffs, Not the Chinese

President Trump
Retailers Tell President Trump They Pay Tariffs, Not the Chinese

Retailers and manufacturers sent a letter to President Trump on Thursday asking him to end what they called the escalation of tit-for-tat tariffs. “Broadly applied tariffs are not an effective tool to change China’s unfair trade practices. Tariffs are taxes paid directly by U.S. companies, including those listed below – not China.”

But don’t be misled – the group also urged the President to be tough when dealing with China: “We agree that our trading partners must abide by global trade rules, and we support the administration’s efforts to address unfair trading practices, including intellectual property violations, forced technology transfer and more.”

As a reminder of how tariffs work, here’s an excerpt from a CBS News article from last month:

“Here’s an example made simple (ignoring real-world minimum amounts subject to tariffs). Say the U.S. imposed tariffs of 6.5% on garden umbrellas from China. If an American retailer wanted to buy 100 garden umbrellas from China for $5 apiece (a pre-tariff total of $500), the 6.5% tariff would come out to $32.50 tariff for the shipment. That raises the total price of the shipment from $500 to $532.50.”

That means retailers must either reduce their profits or pass along the added cost to consumers.

Sponsored Link

Interestingly, the National Retail Federation announced last week that it found retailers are stocking up on inventory to get ahead of higher tariffs:

“The Trump administration increased 10 percent tariffs on $200 billion worth of Chinese goods to 25 percent in May, with the increase applying to imports that arrive in the United States after June 15. The administration has also proposed to implement new 25 percent tariffs on $300 billion worth of Chinese goods and recently removed India and Turkey from the Generalized System of Preferences program, which allows certain items to be imported duty-free. In addition, the administration announced a 5 percent escalating tariff on all imports from Mexico,…”

In Thursday’s letter, available in a PDF document on DocumentCloud.org, retailers wrote in part:

“Mr. President, we support your efforts to hold our trading partners accountable, level the playing field for American businesses and forge enforceable trade agreements. We urge your administration to get back to the negotiating table while working with our allies to develop global, enforceable solutions. An escalated trade war is not in the country’s best interest, and both sides will lose. We are counting on you to force a positive resolution that removes the current tariffs, fosters American competitiveness, grows our economy and protects our workers and customers.”

Ina Steiner on EmailIna Steiner on LinkedinIna Steiner on Twitter
Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

5 thoughts on “Retailers Tell President Trump They Pay Tariffs, Not the Chinese”

  1. Tariffs are the onyl way at the moment to leverage against China. A country completely taking advantage of our country, and ignoring all of the international laws. A country that is despicable and unethical and way worse then north korea ever will be in regards to human rights and dignity.

    Besides, it has already forced many chinese junk importers to look at other countries to source products..so it actually has done quite a bit of good. I know of one place that went to india for production instead of China due to the tariffs.

    The whole point of the tarrif is that it forces importers to look elsewhere, which in turn hurts China. So its not as easy as ” china isn’t the one paying the tariff.” its a more circular effect in that importers will be forced to re-evaluate their business in china, since that lucrative slave pricing isn’t as lucrative anymore.

  2. Maybe those retailers need to stop being a part of the problem and stop buying from China. Maybe they need to move their manufacturing facilities to more friendly shores. After all, they’re the ones who made it possible for China to take over such a major portion of our manufacturing and gradually gain a stranglehold on our economy.

  3. @ Monkposty

    Agreed.

    If you want to knock out the cheap Chinese junk coming into the country then you have to force retailers to source merchandise elsewhere.

    The tariffs effect us directly for some wholesale supplies and unfortunately there is no other source for some of them because production ceased on those items in the USA years ago leaving China the only manufacturing source so we are stuck in the middle of it and will raise our prices as needed

    Sadly we can’t pick and chose what items get tariffs placed on them, it has to be all products as a whole in order to get them back in check.

    While it may suck for awhile eventually it will be good for everyone in the end.

  4. I agree–stop buying from China. But unless you can find what you need made in the USA–you won’t know if items you’re buying from outside of the country are truly made in that country–or redirected from China. It is a sad fact that the US companies sold their manufacturing equipment to the Chinese, which started this cycle. Our factories would need to rebuild. And even if an umbrella costs you a dollar more–what company is going to go to the expense of buying the equipment (made in Pakistan?) to make umbrellas?

    Until investors are willing to help companies rebuild manufacturing plants with modern technology we’ll never reclaim our ability to say it’s “Made in the USA.”

  5. It would be great if we could rebuild our manufacturing industry again, but I’m not necessarily suggesting that retailers source everything in the US. Only that they need to stop buying from China. Until we do rebuild our manufacturing industry, it only makes sense that you’d have to source items elsewhere. If there are certain things you can only get from China, then limit the procurement to those.

Comments are closed.