Who pays a tariff?

A tariff is a tax the importing company pays when goods cross the border. Follow one product to the shelf.

Price the importer pays abroad Tariff rate Share of the tariff passed on The rest is absorbed by the importer or the foreign seller. Store markup Added on top of what the store pays.

Shelf price before

Shelf price after

Shopper pays extra

1Importer buys the product abroad
2Importer pays the tariff to U.S. Customs
3Part of the tariff is added to the price the store pays
4Store adds its markup and sells to you

Tariff passed on in prices
Tariff absorbed by businesses