Tariffs are taxes or duties imposed by the federal government on imported goods. These charges are typically used to generate revenue, protect domestic industries from foreign competition, or influence trade policy. Tariffs are assessed as a percentage of the value of imported goods and are collected by U.S. Customs and Border Protection at the time of entry into the country.
The U.S. tariff system is governed primarily by the Harmonized Tariff Schedule of the United States (HTSUS), which classifies goods and specifies the applicable duty rates. The authority to impose or adjust tariffs lies with Congress, but the president may also modify tariffs under certain trade laws, such as the Trade Expansion Act of 1962 and the Trade Act of 1974. These provisions allow for tariffs based on national security, trade imbalances or retaliation for unfair practices.
The use of tariffs can have wide-ranging economic effects. They may lead to increased prices for consumers and businesses that rely on imported materials, while benefiting domestic producers facing reduced competition. Tariffs can also prompt retaliatory measures from trading partners, potentially escalating into trade conflicts.
What is the time frame for Trump's tariffs leading to price increases?
President Trump's tariffs are going to affect products imported by U.S. companies, with importing companies likely to pass on those costs to consumers through higher prices.
What to know about President Trump's 'Liberation Day' tariffs
President Donald Trump revealed his tariff plans as part of a "Liberation Day" ceremony at the White House. Uncertainty over tariffs has roiled financial markets in recent weeks.
What are tariffs, how do they work and who pays for them?
President Donald Trump's tariffs on America's three largest trading partners have led to questions about how tariffs work and who pays for them when goods are imported.