US tariffs on imports hit American consumers hardest, new study reveals

• American importers pay nearly 96% of tariff costs while foreign exporters maintain stable pricing and reduce shipment volumes instead of lowering prices
• Targeted countries like Brazil (50% tariff) and India (25-50% tariff) kept export prices unchanged, shifting the burden entirely to US buyers
• Tariffs generated approximately $200 billion in revenue but function as a consumption tax on US businesses and households rather than a tool forcing concessions from trading partners

Summary

A new study by the Kiel Institute for the World Economy reveals that Trump administration tariffs on foreign imports are being absorbed almost entirely by American businesses and consumers, contradicting claims that foreign exporters bear the costs.

Key Findings

The analysis found that 96% of tariff costs fall on US importers, not foreign sellers. The study examined 25 million transactions representing approximately $4 trillion in trade and determined tariffs generate around $200 billion in revenue paid primarily by American firms and households.

Specific Examples

Brazil faced a 50% tariff on certain products in 2025, while India experienced tariffs starting at 25%, later doubled to 50%. In both cases, exporters maintained stable dollar prices rather than reducing them to offset duties, instead choosing to reduce shipment volumes.

Market Implications

The research indicates tariffs function more like a domestic consumption tax than an economic leverage tool against trading partners. Foreign exporters have successfully avoided price concessions by accessing alternative global markets, leaving US importers to either absorb higher costs or pass them to customers.

This creates a ripple effect across multiple sectors, affecting pricing strategies, business margins, and consumer prices. The findings undermine the administration's argument that tariffs force foreign companies to make financial concessions.

Broader Impact

Rather than pressuring trade partners, tariffs are primarily reshaping domestic pricing structures. American businesses face difficult choices between maintaining margins and remaining competitive, while consumers ultimately bear the brunt of increased costs through higher retail prices across various product categories.