U.S. President-elect Donald Trump speaks at a House Republicans Conference meeting at the Hyatt Regency on Capitol Hill on Nov. 13, 2024, in Washington, D.C.
With all the talk of tariffs from President-elect Donald Trump, what does it mean? How could it affect prices here at home, and why is he pressing this issue in the first place?
With about 50 days to go before he takes office once again, Trump is diving into trade relations, saying he’ll impose a 25% tariff on all imports from Mexico and Canada, and an additional 10% tariff on imports from China.
But what is a tariff?
“A tariff is nothing more than a toll charge on imported goods,” James Mohs, a University of New Haven associate professor of accounting and taxation, said.
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He said the purpose of tariffs is to encourage domestic production of a good, among other things.
“They can be used to shield domestic industries from unfair trade practices for national security reasons,” Mohs said.
Some economists fear these tariffs could lead to higher prices for consumers on things like produce from Mexico and crude oil from Canada.
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The domestic importer would be paying the tariff and passing costs along to customers. Mohs said that assessment remains unclear.
“We haven't seen the whole picture, how much he's going to do for each product,” he said.
He believes any tariffs, if levied, would be more targeted, like crude oil from Canada, but any price increase from that would be offset with more domestic drilling.
“We'd have an excess of supply. We'd be buying less from them. They'd probably have to drop their prices,” he said.
Mohs said Trump is using threats of tariffs as a negotiating tactic especially towards Mexico and Canada, hoping it will leverage more favorable terms when it comes to things like immigration.
He said it’s possible no meaningful tariffs could come about if there’s cooperation.
“But as long as these countries work with him, I don't think there's going to be much of a change,” Mohs said.
Some shoppers aren’t too worried about a possible jump in prices, but others have concerns.
“I’ll just work around it. I don’t have children so people with children will have to really worry more about pricing,” Margaret Lajoie, of Newington, said.
“We’re definitely conscious of it, like being first-time parents too, so it’s at the forefront every day pretty much,” Antonio Jaquez, of West Hartford, said.
“I think other items the tariffs have an impact on would be very concerning. We’ll see. We’ll see how it all shakes out,” Danielle Douglas-Gabriel, of Hartford, said.
Mohs said he also believes the economic team Trump has in place for his incoming administration will temper any impulses he may have.
He said even if those tariffs do go into effect, it would take months for any of us to see any changes.
