One word best describes President Donald Trump’s second-term monetary strategy: taxes. As his storm of transfer taxes went into overdrive in recent months, marketplaces trembled and company leaders sounded alarms about the financial damage they may cause. A recent report from exploration firm Conference Board has revealed a significant decline in consumer confidence across all populations since Trump’s spring-based import tax laws were introduced. If that lack of confidence in the economy sounds acquainted, I might be able to help you make sense of the tax position.

Trump has continued to chamber forward despite recent uncertainty, doubling the tariffs on imported steel and aluminum and announcing a new agreement that would increase the rate against China to 55 %, all of which will likely have an impact on your cost of living. That all came after Trump’s programs hit their biggest roadblock but in judge, when late last month the US Court of International Trade ruled that Trump had overstepped his jurisdiction when he imposed taxes. Although this decision was ultimately overturned, the Supreme Court will likely make a final decision in the future.

But things shake out in the ending, the preliminary ruling certainly came as a relief to some, given the chaos and uncertainty that Trump’s tariffs have caused so far. Trump has just attacked businesses, including Walmart and Apple, for their responses to the taxes or how they discussed their effects. Apple has been working to move manufacturing for the US market from China to relatively less-tariffed India, to which Trump has &nbsp, threatened them with a 25 % penalty rate&nbsp, if they don’t bring manufacturing to the US instead. For instance, researchers predicted that a US-made phone would charge consumers about$ 3,500. During a recent earnings phone, &nbsp, Walmart warned&nbsp, that prices would surge on things like toys, technology and meal at some point in the summer, which prompted Trump to require the string eat the costs themselves, another doubtful scenario.

You might still be wondering: What exactly are taxes and what will they think for me in the midst of all this vibration?

The quick solution: Expect to pay more for at least some goods and services. Continue reading for the lengthy response, and for more, visit CNET’s cost tracker for 11 well-known and tariff-vulnerable products.

What are levies?

Simply put, a tax is a duty on the cost of importing or exporting products by a specific nation. So, for example, a “60 % tariff” on Chinese imports would be a 60 % tax on the price of importing, say, computer components from China.

Trump has long favored goods as the backbone of his economic ideas, frequently claiming that the money earned from taxes on imported goods would aid in the financing of various aspects of his plan. The US imports$ 3 trillion of goods from other countries annually. &nbsp,

The president has also, more just, shown a certain fixation on trade deficits, claiming that the US having a trade imbalance with any land means that land is ripping the US out. As many economists have pointed out, this is a flawed understanding of the problem because deficits are frequently just a simple case of resource realities: wealthy countries like the US purchase specific goods from those that already exist, while those countries may not be wealthy enough to purchase a lot of things from the US.

While Trump deployed tariffs in his first term, notably against China, he ramped up his plans more significantly for the 2024 campaign, promising 60 % tariffs against China and a universal 20 % tariff on all imports into the US. A universal tariff on all exports is a reality, and tariffs against China are more than double that amount right now.

” Tariffs are the greatest thing ever invented”, Trump said at a campaign stop in Michigan last year. In a post on Truth Social, he once referred to himself as” Tariff Man.” &nbsp,

Who suports the tariffs ‘ costs?

Trump repeatedly claimed, before and immediately after returning to the White House, that the country of origin for an imported good pays the cost of the tariffs and that Americans would not see any price increases from them. However, this is not the case, as economists and fact-checkers argued.

The companies importing the tariffed goods– American companies or organizations in this case– pay the higher costs. Companies can raise prices or bear the additional costs for themselves to make up for it.

So, who ends up paying the price for tariffs? In the end, typically you, the consumer, are the culprit. For instance, a universal tariff on goods from Canada would increase Canadian lumber prices, which would have the knock-on effect of making construction and home renovations more expensive for US consumers. Although it is possible for a company to absorb the costs of tariffs without raising prices, this is not at all likely, at least for the moment.

Speaking with CNET, Ryan Reith, vice president of International Data’s worldwide mobile device tracking programs, explained that price hikes from tariffs, especially on technology and hardware, are inevitable in the short term. He predicted that the full cost of Trump’s tariffs would be passed on to consumers, he termed it the” cost pass-through.” Any potential efforts for companies to absorb the new costs themselves would come in the future, once they have a better understanding of the tariffs, if at all.

Which Trump tariffs are in effect?

Following Trump’s” Liberation Day” announcements on April 2, the following tariffs are in effect:

• As of June 4, imports of steel and aluminum were subject to a 50 % tariff, up from 25 %.
• A 30 % tariff on all Chinese imports until the new deal touted by Trump takes effect, after which it will purportedly go up to 55 %. Due to China’s prominence in Trump’s trade agenda, this rate has a rate that is notably higher than others and has steadily increased as Beijing continues to impose tariffs on its own, peaking at 145 % before trade talks started.
• 25 % tariffs on imports from Canada and Mexico are not covered under the 2018 USMCA trade agreement brokered during Trump’s first term. The deal covers the majority of the new tariffs, which include about a third of all imports from Mexico and about half of all those from Canada. Energy imports not covered by USMCA will be taxed at only 10 %.
• A 25 % surcharge on all imported automobiles and parts.
• A sweeping overall 10 % tariff on all imported goods.

Trump imposed what he called “reciprocal” tariffs that exceeded the 10 % level for some nations that Trump claimed were more responsible for the US trade deficit: 20 % for the 27 members of the European Union, 26 % for India, 24 % for Japan, and so on. These were meant to take effect on April 9 but were delayed by 90 days due to historic stock market volatility, which makes the new effective date July 8.

Trump’s claim that these reciprocal tariffs are based on high tariffs imposed against the US by the targeted countries has drawn intense pushback from experts and economists, who have argued that some of these numbers are false or potentially inflated. For instance, the above chart indicates a 39 % tariff from the EU despite the US’s average tariff being around 3 %. Some of the tariffs are against places that are not countries but tiny territories of other nations. For instance, neither the Heard nor McDonald Islands have any inhabitants. We’ll dig into the confusion around these calculations below.

Notable is that those steel, aluminum, and auto tariffs won’t be added to those minimum 10 %. Canada and Mexico were also spared from the 10 % minimum additional tariff imposed on all countries the US trades with.

The administration announced on April 11 that reciprocal tariffs would apply to smartphones, laptops, and other consumer electronics, as well as to flat-panel displays, memory cards, and other types of consumer electronics. But it wasn’t clear whether that would remain the case or whether such products might face different fees later.

How were the reciprocal tariffs for Trump calculated?

The numbers released by the Trump administration for its barrage of “reciprocal” tariffs led to widespread confusion among experts. Trump’s own claim that these new rates were derived from halving the tariffs that have already been imposed on the US by some nations was widely disputed, with some critics claiming that some of the figures listed for specific nations were significantly higher than the actual rates and that some nations had tariff rates listed despite not having any specific tariffs against the US at all.

In a post to X that spread fast across social media, finance journalist James Surowiecki said that the new reciprocal rates appeared to have been reached by taking the trade deficit the US has with each country and dividing it by the amount the country exports to the US. He explained that this consistently produced the reciprocal tariff percentages that the White House had consistently revealed across the board.

Surowiecki described the finding as “extraordinary nonsense.”

The White House later attempted to debunk this idea, releasing what it claimed was the real formula, though it was quickly determined that this formula was arguably just a more complex version of the one Surowiecki deduced.

What impact will Trump’s tariffs have on prices?

In short: Prices are almost certainly going up, if not now, then eventually. That is, if the goods even make it to US shelves because some tariffs are simply too high for businesses to bother with.

While the effects of a lot of tariffs might not be felt straight away, some potential real-world examples have already emerged. Microsoft has raised overall costs for its Xbox gaming brand, with the price of its flagship Xbox Series X console rising 20 % from$ 500 to$ 600. Elsewhere, Kent International, one of the main suppliers of bicycles to Walmart, &nbsp, announced that it would be stopping imports from China, which account for 90 % of its stock.

White House trade adviser Peter Navarro mentioned Trump’s tariff plans just before they were made, and he predicted that over the next ten years, they would bring in$ 6 trillion in revenue. Given that tariffs are most often paid by consumers, CNN characterized this as potentially” the largest tax hike in US history”. According to recent estimates from the Yale Budget Lab, which was cited by Axios, Trump’s new tariffs will increase inflation by 2.3 % over the course of 2025. This translates to about a$ 3, 800 increase in expenses for the average American household.

According to Reith, an analyst for IDC, Chinese-based tech companies like those found in Acer, Asus, and Lenovo are currently” 100 % exposed” to these import taxes, with phones and computers among the most susceptible to suffer. He also said that the companies best positioned to weather the tariff impacts are those that have moved some of their operations out of China to places like India, Thailand and Vietnam, singling out the likes of Apple, Dell and HP. Samsung, which is based in South Korea, is also likely to stay away from Trump’s tariffs in full. &nbsp,

Apple has started moving its manufacturing from China to India in an effort to lower its tariff burden.

Will tariffs impact prices immediately?

In the short run, in the weeks or days following a tariff’s effective date, perhaps not. There are still a lot of products in the US imported pre-tariffs and on store shelves, meaning the businesses don’t need a price hike to recoup import taxes. When new products need to be imported from abroad, prices start to rise as a result of tariff increases, or products stop selling. &nbsp,

Consumers are anxious because of this uncertainty. CNET’s survey revealed that about 38 % of shoppers feel pressured to make certain purchases before tariffs make them more expensive. About 10 % of people claim to have already made certain purchases in order to avoid price increases, and 27 % claim to have delayed purchases for items over$ 500. Generally, this worry is the most acute concerning smartphones, laptops and home appliances.

În a post on Bluesky just after Trump’s” Liberation Day” announcements, Mark Cuban, a billionaire businessman and Trump critic, raised questions about when to purchase particular items. In it, he suggested that consumers might want to stock up on certain items before tariff inflation hits.

” It’s not a bad idea to go to your neighborhood Walmart or big box store right away and purchase a lot of consumables,” Cuban wrote. ” From toothpaste to soap, anything you can find storage space for, buy before they have to replenish inventory. They will jack up the price and blame it on tariffs, even if it’s made in the USA.

CNET’s Money team recommends that before you make any purchase, especially a high-ticket item, be sure that the expenditure fits within your budget and your spending plans. To say the least, buying something you can’t afford right away because it might be less affordable later can be difficult.

What is the goal of the White House tariff plan?

The typical objective of tariffs is to deter consumers and businesses from purchasing the tariffed, foreign-sourced goods and to encourage them to instead choose to purchase domestically produced goods. When implemented in the right way, tariffs are generally seen as a useful way to protect domestic industries. &nbsp,

One of the stated intentions for Trump’s tariffs is along those lines: to restore American manufacturing and production. The White House also claims to be in talks with a number of nations looking for tariff exemptions, and some officials have also suggested that Trump’s tax cuts will be funded by the tariffs.

You don’t have to think about those goals for too long before you realize that they’re contradictory: If manufacturing moves to the US or if a bunch of countries are exempt from tariffs, then tariffs aren’t actually being collected and can’t be used to finance anything. Many economists have argued that Trump’s plans are misguided due to this and many other factors. &nbsp,

Because importers can fall back on them right away, tariffs are a better tool for protecting already-existing industries because they allow the US to return manufacturing to them or “reshoring” it. Building up the factories and plants needed for this in the US could take years, leaving Americans to suffer under higher prices in the interim. &nbsp,

That problem is worsened by the fact that the materials needed to build those factories will also be tariffed, making the costs of “reshoring” production in the US too heavy for companies to stomach. These issues, along with Trump’s general instability of American economic policies, are a part of why experts worry that Trump’s tariffs could have the opposite effect: preventing manufacturing from entering the US and forcing consumers to pay inflated prices. Any factories that do get built in the US because of tariffs also have a high chance of being automated, canceling out a lot of job creation potential. To illustrate this in practice, toy manufacturer Mattel also pointed out that it had no plans to relocate its manufacturing to the US when it warned customers about upcoming price increases.

Trump has reportedly been fixated on the notion that Apple’s iPhone– the most popular smartphone in the US market– can be manufactured entirely in the US. For many of the same reasons mentioned above, experts have generally disregarded this, as well as the fact that an iPhone made in America could cost upward of$ 3,500. One report from 404 Media dubbed the idea” a pure fantasy”. CEO Tim Cook stated in 2017 that the US lacks the number of tooling engineers needed to produce its products, citing the overall sophistication and breadth of China’s manufacturing sector.

For more, see how tariffs might raise the prices of Apple products and find some expert tips for saving money.