Get Ready to Start Paying Even More as Trump’s ‘Forever’ Tariffs Kick in for the Long Haul

by | Aug 15, 2026 | Quick Facts

Photo by Amira El Fohail, Unsplash

Get Ready to Start Paying Even More as Trump’s ‘Forever’ Tariffs Kick in for the Long Haul

by | Aug 15, 2026 | Quick Facts

Photo by Amira El Fohail, Unsplash

With so many tariffs in the mix, consumers will be even more squeezed because many of these taxes will be stacked on top of one another.

Republished with permission from The Conversation, by Kent Jones, Babson College

President Donald Trump’s tariff announcements no longer cause the market gyrations that they did in 2025. But their sticker shock for American consumers is becoming increasingly clear—just as economic sentiment is souring ahead of the November 2026 midterm elections.

Many business groups had hoped that the tariff wars would end in February, when the Supreme Court overturned Trump’s emergency tariffs. They got a rude awakening five months later, however, when Trump announced a raft of new import taxes to replace the levies that were struck down.

Covering nearly all U.S. imports, the advantage of these tariffs in the Trump administration’s view is that they’re more firmly based on existing U.S. trade law, beyond the reach of the Supreme Court’s review. And Trump has said he envisions enacting many more of these so-called trade law tariffs.

As a trade economist who has been following the tariff wars, I believe that the longer these import taxes are in place, the more the consumers will bear their burden. The 2025 “Liberation Day” tariffs that the Supreme Court struck down, as well as other levies Trump announced after the February ruling, turned out to be temporary. But the bulk of the new levies are designed to be permanent.

That means that for consumers, the total cost burden is likely to increase even if the tariff rates don’t change—because the new tariffs will be stacked on older ones.

The Cost Squeeze

On one level, Trump’s tariff fixation is a mystery. Tariffs continue to be unpopular, and it’s unclear why Trump would double down on them before midterm elections when his approval ratings, including on the economy, are so low.

But on another level, Trump’s embrace of tariffs can be understood as an instrument of personal power. He has long viewed them as tools for negotiating leverage, and he recently declared that U.S. tariffs “aren’t high enough.” The president also has deflected criticism of their impact on consumer prices by claiming erroneously that foreigners pay for them.

The simple fact is that U.S. tariff invoices issued by the Treasury Department are sent to the U.S. businesses that import the foreign products. These companies may try to absorb some of the cost to protect their market share and work through existing inventory. But eventually, the squeeze will compel them to pass most of that extra tax onto U.S. consumers—no matter which foreign countries are targeted.

And now that tariffs have had time to work through the economy, researchers have found an impact on prices. The Dallas Federal Reserve recently estimated that the Fed’s preferred inflation measure would have risen without tariffs at an annual rate of 2.3% in March, instead of its actual 3.2%. Meanwhile, an analysis by the Yale Budget Lab concluded that consumers are paying anywhere from half to the entire cost of the levies through higher prices, depending on the goods.

Tariffs Upon Tariffs

Trump based his July tariff announcements on three different legal justifications: a country’s unfair trade practices, like forced labor, which is known as Section 301; national security protection, or Section 232; and discrimination against U.S. imports, or Section 338. The last is a trade war tariff dating to the Smoot-Hawley Tariff Act of 1930.

The new Section 301 tariff rates, which are global, currently range from 10% to 12.5%, but they could go up at the president’s discretion.

Section 301 has also opened the door to new country-specific tariffs targeted at Brazil, at 25%, while Section 338 was cited to slap an extra 50% import tax on certain Canadian goods. In addition, Trump has imposed levies ranging from 25% to 50% for specific products, covering steel, aluminum, automobiles, copper, timber, lumber and pharmaceuticals.

Yet more new tariffs are planned for wind turbines, personal protective and medical equipment, robotics, machinery and coal, as well as to combat foreign excess production capacity and support U.S. production of foreign generic prescription drugs.

With so many tariffs in the mix, consumers will be even more squeezed because many of these taxes will be stacked on top of one another. For example, Section 301 tariffs will be applied on top of the older legacy tariffs that date back to World Trade Organization rules setting a baseline Most Favored Nation rate, as well as on top of each other.

So if a country ends up facing tariffs based on forced labor violations as well as excess capacity, each at 10%, on top of a uniform Most Favored Nation rate of 3%, the total rate on all products from that supplying country would be 23%. And this levy will be paid by U.S. consumers, not foreigners.

Pushback From the States

Trump is especially interested in Section 301, which is meant to remedy foreign trade practices that are discriminatory, unfair or unreasonable, and that burden U.S. commerce. It sets no limit on tariff rates and lets the president discriminate among exporting countries. Furthermore, federal courts have typically given the president broad discretion in implementing the statute.

Trump chose to use this measure to punish virtually all U.S. trading partners on grounds that they failed to prevent imports into their markets that were made with forced labor. His administration based the decision on its own investigation that determined the U.S. is the only country that prevents forced labor imports.

These tariffs were set at 12.5% for countries without any formal prohibition on forced labor imports, and 10% for all other countries with such a prohibition. These tariffs are similar in scope and impact to the earlier Liberation Day tariffs.

Twenty-five U.S. states then challenged these levies at the U.S. Court of International Trade, using similar reasoning as the Supreme Court when it struck down the emergency tariffs on grounds that they were an unconstitutional tax on U.S. consumers. Citing the affordability burden, the lawsuit claims that the Section 301 tariffs do the same thing. Nor did the administration offer any indication of how the tariffs were calculated and when, if ever, they would be removed.

The lawsuit further alleges that the new tariffs go far beyond the original purpose of Section 301, which is to open specific markets to U.S. exports through negotiated policy reforms, not to impose global tariffs with no clear goal in sight.

Whether this legal challenge will succeed depends in part on whether judges will continue to defer to the president on these particular levies, no matter how much they deviate from previous practice. And I believe Trump is counting on it.The Conversation

Kent Jones, Professor Emeritus of Economics, Babson College

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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