Trump’s Broad Tariffs Saddle U.S. Small Firms With $202 Billion Bill

President Donald Trump’s latest round of import tariffs, which took effect on 7 August and run as high as 50 percent, is reverberating through both sides of the Pacific. Goods from more than 60 countries—including European and Asian allies—now face higher duties, while imports from China were already subject to steep levies that rose by about 30 percentage points earlier this year. In the United States, the burden is falling heavily on smaller companies that rely on foreign inputs. The U.S. Chamber of Commerce puts the number of small-business importers—firms with fewer than 500 employees—at roughly 236,000. Their 2023 purchases abroad totaled $868 billion, and the lobby group projects the new measures will add a combined $202 billion a year in duties, or roughly $856,000 per firm. Logistics provider Geodis says many of these companies lack the compliance staff and bonding capacity needed to navigate the more complex customs regime. Until June, importers had absorbed more than half of the added costs, but Goldman Sachs expects two-thirds of the burden to shift to consumers in the coming months, heightening inflation pressures that critics say are already raising living costs from cars to coffee. Retail and small-business associations warn that access to credit and hiring plans are being scaled back as margins tighten. Across the Pacific, Chinese manufacturers are also retrenching. A Reuters survey of factory owners in Guangdong found producers shortening shifts, moving workers to temporary contracts and cutting wages to remain price-competitive after losing U.S. orders. Exports to the United States fell 21.7 percent in July, but shipments to other markets such as Australia rose, intensifying domestic competition. Economists say the trend is masking a rise in underemployment and adding a deflationary drag to China’s economy even as its headline jobless rate hovers near 5 percent. Although Democratic lawmakers have attacked the tariff strategy as a hidden tax on households, policy analysts note that a full repeal is unlikely before the 2028 election, leaving businesses on both sides of the Pacific bracing for a protracted period of higher trade barriers and political uncertainty.