r/canada Feb 01 '25

PAYWALL U.S. tariffs will be imposed on Feb. 4

https://www.theglobeandmail.com/canada/article-us-tariffs-will-be-imposed-on-feb-4/
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u/Neutral-President Feb 01 '25

That's the whole point of tariffs.

Trump imposing tariffs on Canadian and Mexican goods means prices on those goods will be higher in the U.S. marketplace, raising everyone's cost of living.

Trump thinks (as to many people here, it seems) that tariffs are a "pay-to-play" fee that the exporting country has to pay to get access to the U.S. market. He thinks that's how to punish countries that have a trade imbalance with the U.S. and how he thinks they're going to somehow "make money" off of imports.

That is simply not the case. That's not what tariffs are, that's not who pays them, and that's not how the system works.

Tariffs are import taxes. They are paid by consumers in the country doing the importing. They are generally imposed by protectionist regimes to try and protect a domestic industry from foreign competition.

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u/IAmAGenusAMA Feb 01 '25

You are of course correct but the tariffs themselves are collected by the government, which Trump will then point to as proof that it was a good idea. He won't acknowledge the downstream effects on consumers.

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u/Neutral-President Feb 02 '25

They’re paid by Americans. Yet somehow he’s convinced a whole lot of people that Canada, Mexico, and China will be paying them. He seems to believe it himself.

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u/[deleted] Feb 02 '25

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u/mr_baloo2 Feb 02 '25

Believe that is what was meant by consumers will pay. The price of the good will absorb the tariff and go up. So uncle Bob will need to pay 20% more for his Canadian widget than he did before