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New York Fed Says Americans Bore Nearly All Costs of 2025 Tariffs

The finding echoes CBO estimates during intensifying congressional, Supreme Court scrutiny.

Nearly 90% of the cost of Trump's tariffs have been borne by American consumers and businesses, according to the New York Federal Reserve.
An American flag flutters over a ship and shipping containers at the Port of Los Angeles, in San Pedro California, U.S., May 13, 2025. REUTERS/Mike Blake/File Photo
President Donald Trump during a signing ceremony for the One Big Beautiful Bill Act on the South Lawn of the White House in Washington, DC, US, on Friday, July 4, 2025.
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Overview

  • The New York Fed reports roughly 90% of last year’s tariff costs fell on U.S. consumers and businesses, undercutting the administration’s claim that foreigners would pay.
  • Incidence shifted over 2025, with Americans bearing about 94% of tariff costs from January to August, 92% in September–October, and 86% in November.
  • The CBO estimates foreign exporters absorbed about 5% of the levies, U.S. firms cut margins to cover roughly 30%, and about 70% was passed through to consumers.
  • Tariff rates jumped on average from about 2.6% to roughly 13% in 2025, with spikes on some Chinese goods reported near 125% before easing to around 113%.
  • Policy and legal challenges have escalated, including a House vote to end emergency tariffs on Canada and a pending Supreme Court ruling that analysts say could trigger large refunds if the measures are struck down.