New York Fed: 90% of U.S. tariffs are borne by American businesses and consumers

On the 12th, the Federal Reserve Bank of New York released a study showing that approximately 90% of the additional costs resulting from the U.S. government’s planned tariffs in 2025 will be borne by American consumers and businesses. The U.S. government has previously claimed that “tariffs are paid by foreign exporters,” generating substantial revenue for the United States. This study was conducted jointly by the New York Fed and Columbia University. The research estimates that the average statutory tariff rate in the U.S. will rise from 2.6% at the beginning of 2025 to 13% by the end of the year. From January to August 2025, American importers and consumers absorbed 94% of the new tariffs; from September to October, this figure was 92%; and in November, 86%. The study shows that, based on an average tariff rate of 13% at the end of 2025, the prices of imported goods affected by tariffs in the U.S. market are 11% higher than those unaffected. Researchers stated that this indicates that most of the economic burden of increased tariffs is borne by American businesses and consumers. The study cites a recent paper by Harvard University professor and former IMF First Deputy Managing Director Gopinath, published on the National Bureau of Economic Research website, to support this view. Gopinath’s paper states that data from 2018-2019 and 2025 show that nearly 100% of the tariffs imposed by the U.S. government on trade partners are passed on to the prices of imported goods in the U.S., with most costs borne by American companies and consumers. (Xinhua)