US Shoppers Brace for Price Hikes Amid New Tariffs

A significant price hike is looming for US shoppers, with impacts expected across industries ranging from affordable gadgets and fashion to electric vehicles. President Donald Trump, citing the International Emergency Economic Powers (IEEPA) Act and the National Emergencies Act (NEA), has introduced new tariffs on imports from Canada, Mexico, and China.

The new tariffs impose a 25% duty on goods imported from Mexico and Canada, while Chinese imports will face a 10% tariff. These changes are expected to hit American consumers hard, with costs likely to be passed down to shoppers.

According to the Tax Foundation:

“The tariffs on Canada and Mexico alone would increase taxes by $958 billion between 2025 and 2034 on a conventional basis, amounting to an average tax increase of more than $670 per US household in 2025.”

Why Target China?

President Trump has justified the 10% tariff on Chinese goods as part of a broader effort to secure China’s cooperation in combating the fentanyl crisis. In a tweet, the White House further emphasized China’s role in the crisis, stating:

“China plays the central role in the fentanyl crisis that is destroying American lives.”

Popular items like iPhones and other electronics, which were previously exempt from tariffs, will now see price increases. A BBC analysis warns:

“The 10% blanket tariff Trump is proposing could affect the price of everything that is made in China and exported to the US—from toys and teacups to laptops.”

Retaliation and Rising Costs

It’s not just US-imposed tariffs that could raise prices. Retaliatory tariffs from affected nations add another layer of challenges. Canada, Mexico, and China have all announced countermeasures in response to the new duties (NYT, LA Times, Reuters).

Experts predict that most companies will pass these additional costs onto consumers, meaning higher prices for everyday goods.

End of the De Minimis Exemption

Another blow to US shoppers is the removal of the de minimis exemption, which previously allowed imports valued under $800 to bypass tariffs, taxes, and fees. This exemption had been a boon for e-commerce platforms like Shein, Temu, JD.com, and Alibaba, which shipped over $47 billion worth of goods to the US using this benefit, according to US Customs and Border Protection.

With the exemption gone, shoppers will likely face higher prices on these platforms, which had gained popularity for their affordable products. Lower-income consumers, in particular, may feel the sting as these low-cost options become more expensive.

Widespread Impact

The tariffs’ effects will ripple across various industries. The price of food, alcoholic beverages, home appliances, and electric vehicles is expected to rise. Vehicle imports, in particular, face significant challenges. Last year, the US imported over $150 billion in vehicles and parts from Mexico and $34 billion from Canada.

An analysis by the Peterson Institute for International Economics highlights the complexities:

“Intermediate goods—especially in motor vehicles—cross the borders multiple times before final assembly. The imposition of tariffs at each stage of fabrication would be disastrous.”

What’s Next?

The full impact of these tariffs remains uncertain, but it’s clear that a trade war is underway. For US consumers, the inflationary effects are expected to unfold quickly, impacting everything from daily essentials to big-ticket items.

As the situation develops, all eyes will be on how businesses and governments navigate these challenges—and how shoppers will manage rising costs.