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The effect of upcoming tariffs....
I just read of a manufacturing employer who just announced to his entire staff that there was not going to be any Christmas bonus this year due to his need to secure equipment and goods instead - prior to the implementation of tariffs.
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The plan is to use tariffs to offset tax hikes to the American people, thereby replacing taxable income to the U.S. Treasury with tariff revenue. I haven't read an analysis of this strategy but it would certainly be unique. |
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Understanding that tariffs, a form of a tax, will absolutely increase the cost of those products as the importer has higher costs.. those costs will be passed to the consumer, while the tariff imposed is collected by the Federal treasury. So now the US gov't has more money, but the consumer has less. This is another example of a regressive tax as consumers get hit but those who are not consuming, the 1%ers who are saving and investing not buying with most of their income are not being taxed. So the tax burden is imposed on those who can least afford it and the benefit of not needing to consider a higher marginal rate from the rich benefits who??
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Everyone else takes a dive, whether they understand how tariffs work or not. |
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Thank you Villages Economists.
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