A recent study by S&P Global projects that trade tariffs implemented during the Trump administration could lead to costs exceeding $1.2 trillion for U.S. companies by 2025, with the majority of these costs likely passed on to consumers. The analysis indicates concerns regarding the potential for increased inflation and impacts on household budgets due to the ongoing trade conflict.
According to the report, approximately two-thirds of the projected costs will be directly transferred to consumers through higher prices, while businesses will absorb the remaining expenses. This analysis is based on data from 9,000 companies, indicating a wide-ranging economic effect.
The researchers noted that tariffs and trade barriers function as taxes on supply chains, redirecting funds to governments, while logistics delays and increased freight costs further exacerbate these impacts. The report described this scenario as a “systemic transfer of wealth” from corporate profits to governments, suppliers, and infrastructure investors.
Additionally, the report highlighted the suspension of the “de minimis rule,” which previously allowed duty-free imports valued under $800. This change represents a significant shift in global trade costs and has been noted to affect online retailers, such as Temu and Shein.
Furthermore, the Yale Budget Lab estimates that U.S. households could incur an additional $2,400 in expenses this year as a result of the new tariffs, which adds to existing pressures from rising living costs.
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