By Daily Mail (U.S.) | Created at 2025-04-03 15:06:47 | Updated at 2025-04-04 08:58:57
18 hours ago
President Donald Trump slapped at least 10 percent sweeping tariffs on all countries sending the markets plummeting and plunging the global economy into uncertainty.
But the president's dramatic announcement on Wednesday does not just come at a steep cost for investors.
It's expected to have a whopping price tag for American consumers.
The conservative advocacy group Advancing American Freedom found that the Trump tariffs are the largest peacetime tax hike in U.S. history.
The group founded by former Vice President Mike Pence estimates the plan will cost American families more than $3,500 a year.
The analysis noted the price tag would easily erase three years worth of pay raises for most families.
It also found that major purchases such as a new home or car could cost families $7,000 more.
President Donald Trump showing off his tariff chart in the White House Rose Garden on Wednesday. Analysis by multiple groups warn Trump's tariffs will cost American consumers thousands as prices go up
While the Trump administration has argued Americans won't be financially impacted and have pointed to some tariffs imposed during the president's first term.
Those tariffs were specifically targeted not sweeping and did come at a cost on certain products.
Advancing American Freedom said that Wednesday's move was ten times the size of tariffs imposed during Trump's first term.
It also warned the tariffs would completely wipe out the entire value of the Trump 2017 tax cuts for the bottom 40 percent of workers just as the president and Republicans are pushing to make the cuts permanent.
But Pence's group is not the only one sounding the alarms on the cost of Trump's actions for consumers.
The Budget Lab at Yale also analyzed the multiple components of Trump's tariff plan and found it would cost Americans thousands.
It found that the April 2nd announcement alone which included the 10 percent baseline tariffs and even higher tariffs on most countries would cost each household on average $2,100 in 2024 dollars.
Including both the tariffs announced on Wednesday as well as other tariffs previously announced this year such as levies on goods from Canada, Mexico, China and foreign automobiles, and it is estimated to cost households an average of $3,800.
It noted that the April 2 tariffs alone and all 2025 tariffs together would disproportionately affect the cost of clothing and textiles forcing apparel prices to increase 17 percent.
Advancing American Freedom estimates Trump's tariffs will cost American families $3,500. The Budget Lab at Yale estimates it would cost $3,800 per household. ING Economics estimates it would cost $1,350 per American
Research by ING Economics also showed a harsh reality for American consumers.
It said in the worst-case scenario where there are no U.S.-made product substitutes, costs would be 3.3 percent higher. On an even spread, that would be about $1,800 for each American or $7,200 for a family of four.
The analysis acknowledged that some of the costs will be absorbed, but when tariffs are slapped on everything, it's harder.
It estimated a more likely 75 percent of the increased cost due to tariffs is passed on to consumers, prices will still rise by 2.5 percent amounting to $1,350 in extra costs for every American.
