E182: When the Little Guys Get Caught in the Tariff WarSeptember 24, 2018 in Ecom-Crew-Podcast
By the time this podcast airs, part 1 of the latest round of tariff increases would have taken effect. Approved by President Trump on September 17th, it effectively slaps a 10% tariff on $200 billion in Chinese goods. Part 2 will be another 25% increase expected to take effect on New Year’s Day 2019.
In just the same year, the Trump Administration has announced three tariff increases. Here are the details on the first two.
- Round 1 – July 6, 2018 – 25% on 16 billion worth of goods (basically everything but non-consumer products)
- Round 2 – August 23 – 25% on 23 billion worth of goods (targets industrial, electronics and tech products)
In response to this attack, the Chinese government provided a counterpunch by adding a 5% to 10% tax on $60 billion of US goods including meat, chemicals, clothes and auto parts.
The move only served to escalate tension between these two economic giants. Unfortunately, since round 3 covers just about everything imported from China that’s being processed and sold on US shores, it’s the little guys who are caught in the middle.
In this episode, Dave and I discuss the implications of these new tariffs on our respective businesses, what our preparations are for its coming, and what our predictions are for these new regulations in light of the November 6 midterm elections.
Here’s a rundown of some of the things that we discussed.
- These new tariffs won’t just mean paying higher duties, it will also result in an increase of shipping fees as ecommerce sellers clamor to get their stock sorted and shipped before the 25% increase on January 1st next year.
- The upcoming midterm elections could potentially have an effect on the full implementation of tariff increase at the beginning of 2019.
- China won’t be backing down any time soon.
- Round 4, should we come around to that, will slap tariff increases on all other goods that haven’t been affected yet
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