Trump’s 2025 tariffs didn’t hit China or other nations — they cost American consumers more, report finds

Trump tariffs 2025 impact Americans: A new study from the Federal Reserve Bank of New York is challenging a key claim about US president Donald Trump’s 2025 tariffs, that foreign countries would bear the cost. Instead, the report found that American companies and consumers paid most of the bill.

Did Trump’s Tariffs Really Cost Foreign Countries

Through August 2025, 94% of the import taxes fell on US firms and households, according to the New York Fed. By November, that “pass-through” rate had slipped to 86%, but researchers were clear in their conclusion: American businesses and consumers “continue to bear the bulk of the economic burden of the high tariffs imposed in 2025," as quoted by USA Today.

How Much Did American Households Pay in 2025

That finding adds to other research pointing in the same direction.


A February 6 analysis from the nonpartisan Tax Foundation estimated that the tariffs amounted to a $1,000 tax increase per household in 2025. Households are projected to pay another $1,300 in 2026. The group also described the tariffs as the largest US tax increase since 1993.

Trump’s Campaign Claim vs Economic Data

During the 2024 campaign, Trump told supporters the tariffs would not cost them anything, saying, “It’s not going to be a cost to you, it’s going to be a cost to another country," as quoted by USA Today.

How Import Tariffs Impact US Businesses and Consumers

Wayne Winegarden, a senior fellow in economics at the Pacific Research Institute, said “The study by the New York Fed confirms what most economists expected – U.S. consumers and businesses pay most of the costs from the Trump tariffs,” as quoted by USA Today.

Simple Example: How a 25% Tariff Raises Prices

The New York Fed offered a simple example of how tariffs work. If a foreign exporter charges $100 for a product and the U.S imposes a 25% tariff, the importer pays $25, pushing the total price to $125 if the exporter doesn’t lower the price. In that case, the cost falls entirely on the American side.

If the exporter cuts the price to $80, the importer pays a $20 tariff and the total price stays at $100, meaning the exporter absorbs the cost.

In reality, most exporters reduced prices only slightly. A 94% pass-through rate means that for a 10% tariff, exporters typically cut prices by just 0.6%, or six cents for every $10.

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National Bureau of Economic Research Findings on Tariff Impact

As companies adjusted by trimming prices, finding cheaper suppliers or absorbing part of the cost, some of the impact was softened. According to the National Bureau of Economic Research paper, about 20% of the tariffs ultimately reached consumers directly.

FAQs

Who paid most of Trump’s 2025 tariffs?

According to the New York Fed, American companies and consumers paid the majority.

How much did tariffs cost households in 2025?

The Tax Foundation estimated about $1,000 per household.