A groundbreaking study by Germany's Kiel Institute for the World Economy (IfW) has found that U.S. tariffs imposed on imported goods are overwhelmingly shouldered by American importers and consumers, contradicting claims that foreign exporters bear the costs. The research, published this week, analyzed over 25 million U.S. import records worth $4 trillion, revealing that only 4% of tariff expenses were absorbed by foreign entities.
U.S. customs revenues surged by approximately $200 billion in 2025 due to tariffs, but the data shows American buyers paid 96% of this amount. "The tariffs are an own goal," said Julian Hinz, IfW's trade policy lead. "Americans are footing the bill." The study found no evidence of foreign exporters lowering prices to compensate for tariffs, effectively making the levies a consumption tax on U.S. consumers.
The findings emerge as trade tensions escalate following former U.S. President Donald Trump's recent announcement of 10% tariffs on imports from eight European countries, including Germany, set to take effect February 1. The IfW warns prolonged tariffs could reduce product variety, squeeze U.S. business profits, and push foreign exporters to seek alternative markets.
For global investors and policymakers, the study provides critical insights into the real-world impacts of protectionist trade measures. As Asian economies navigate shifting U.S. trade policies, the data underscores the importance of diversified markets and supply chain resilience.
