Textile to cost Americans more after Trump’s tariffs

In April, US President Donald Trump announced he was introducing sweeping new tariffs, extra taxes that importing firms have to pay if they bring in goods from abroad.

Since then some of the US’s major trading partners including the UK, Japan and now the European Union have negotiated down the headline tariff rates. The EU’s agreement cuts in half the 30% tariff Trump had threatened.

But other countries are still facing higher rates, including Canada, which will see tariffs rise to 35% on 1 August if no deal is reached.

Trump says the extra tariffs will generate billions in revenue and encourage firms to manufacture in the US to avoid the taxes.

But there are already signs that the levies may be pushing up prices for American consumers and economists argue that there is still some way to go before American shoppers feel the full force of the rises.

Clothing and footwear

The vast majority of clothing and footwear sold in the US is made in other countries, including the manufacturing hubs of Vietnam, China and Bangladesh.

Though Trump has backed down from the steepest tariffs he initially threatened, the taxes on imports from those countries are still sharply elevated.

Under current plans, the US is charging at least 30% on goods made in China, with plans to start collecting taxes of 19% on items from countries such as Vietnam and Indonesia on 1 August. Trump has outlined tariffs as high 35% for goods from Bangladesh.

The measures are putting pressure on major US department stores like Target and Walmart, where Americans often turn for affordable clothing, as well as big-name apparel brands, such as Levi Strauss and Nike, which have said they will raise prices for certain items.

After months of declines, apparel prices jumped 0.4% from May to June. Overall, the Budget Lab at Yale, which monitors the impact of government policy on the economy, expects clothing prices overall to surge a shocking 37% in the short run.

Source: BBC News