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America’s Own Goal: Who Pays the Tariffs?

with Anna Vorwig, Hendrik Mahlkow and Aaron Lohmann. Kiel Policy Brief, No. 201. January 2026.
India exports to US: log(unit value)

India exports to US: log(unit value)

The 2025 US tariffs are an own goal: American importers and consumers bear nearly the entire cost. Foreign exporters absorb only about 4% of the tariff burden—the remaining 96% is passed through to US buyers. Using shipment-level data covering over 25 million transactions valued at nearly $4 trillion, we find near-complete pass-through of tariffs to US import prices. US customs revenue surged by approximately $200 billion in 2025—a tax paid almost entirely by Americans. Event studies around discrete tariff shocks on Brazil (50%) and India (25–50%) confirm: export prices did not decline. Trade volumes collapsed instead. Indian export customs data validates our findings: when facing US tariffs, Indian exporters maintained their prices and reduced shipments. They did not “eat” the tariff.

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Last updated on January 25, 2026. © Julian Hinz 1987–2026.