U.S., Chinese tariff hikes take effect as trade war esclates
WASHINGTON — The United States and China went ahead with their latest tariff increases on each other’s goods Sunday, potentially raising prices Americans pay for some clothes, shoes, sporting goods and other consumer items in advance of the holiday shopping season.
The 15% U.S. taxes apply to about $112 billion of Chinese imports. All told, more than twothirds of the consumer goods the United States imports from China now face higher taxes. The administration had largely avoided hitting consumer items in its earlier rounds of tariff hikes.
But with prices of many retail goods now likely to rise, the Trump administration’s move threatens the U.S. economy’s main driver: consumer spending. As businesses pull back on investment spending and exports slow with weak global growth, American shoppers have been a bright spot for the economy.
As a result of Trump’s higher tariffs, many U.S. companies have warned that they will be forced to pass on to their customers the higher prices they will pay on Chinese imports. Some businesses, though, may decide to absorb the higher costs rather than raise prices for their customers.
In China, authorities began charging higher duties on American imports at midday Sunday, according to employees at customs offices in Beijing and the southern port of Guangzhou. They declined to be identified.
Tariffs of 5% and 10% apply to items ranging from frozen sweet corn and pork liver to marble and bicycle tires, the government announced earlier.
After Sunday’s tariff hike, 87% of textiles and clothing the United States buys from China and 52% of shoes will be subject to import taxes.
On Dec. 15, the Trump administration is scheduled to impose a second round of 15% tariffs — this time on roughly $160 billion of imports. If those duties take effect, virtually all goods imported from China will be covered.
The Chinese government has released a list of American imports targeted for penalties on Dec. 15 if the future U.S. tariff hikes take effect. In total, Beijing says Sunday’s penalties and the planned December increases will apply to $75 billion of American goods.
Washington and Beijing are locked in a war over U.S. complaints that China steals U.S. trade secrets and unfairly subsidizes its own companies in its drive to develop global competitors in such hightech industries as artificial intelligence and electric cars.
Trump has argued that China itself pays the tariffs. But in fact, economic research has concluded that the costs of the duties fall on U.S. businesses and consumers. Trump had indirectly acknowledged the tariffs’ impact by delaying some of the duties until Dec. 15, after holiday goods are on store shelves.
A study by J.P. Morgan found that Trump’s tariffs will cost the average U.S. household $1,000 a year. That study was done before Trump raised the Sept. 1 and Dec. 15 tariffs to 15% from 10%.
The president has also announced that existing 25% tariffs on a separate group of $250 billion of Chinese imports will increase to 30% on Oct. 1.