China announced Friday that it will impose a 34% reciprocal tariff on all U.S. imports — the first retaliatory measure against President Donald Trump’s global tariffs plan.
The decision marks a significant escalation in the ongoing trade war between the world’s two largest economies.
“This practice of the U.S. is not in line with international trade rules, undermines China’s legitimate rights and interests, and is a typical unilateral bullying practice,” China’s finance ministry said in a statement.
Why did China impose tariffs on the United States?
The Trump administration imposed a 10% minimum tariff on all imports coming into the country and even higher tariffs on the European Union and dozens of other top American trading partners, including China.
China was already subject to a 20% tariff when Tump announced the additional levies on Wednesday during a ceremony in the Rose Garden at the White House. Beijing now has an effective U.S. import tax rate of 54%, one of the highest for any major American trading partner.
When will the tariffs take effect?
The new U.S. tariff rate on China will go into effect on April 9, while the newly announced levies on American imports will go into affect on April 10 in China.
Who pays for tariffs?
While many assume that foreign companies pay tariffs, it’s actually the importer — usually a domestic business — who covers the cost. Tariffs are essentially taxes on goods brought into a country, which makes imported products more expensive.
The importer may absorb the added cost, but typically, they pass it on to consumers through higher prices. So, even though you don’t pay the tariff directly, it’s ultimately reflected in the price you pay at checkout.
In the end, both businesses and consumers bear the financial burden of tariffs.
When did the trade war between China and the US begin?
The trade war between the U.S. and China began in 2018, early in President Trump’s first term, when his administration imposed tariffs and other trade barriers on Chinese goods. Trump cited longstanding unfair trade practices and intellectual property theft as the reasons behind the move.
Top US goods hit by Chinese import tariffs:
Top Chinese goods hit by US import tariffs:
This article originally appeared on Austin American-Statesman: China imposes 34% tariffs on all US goods in response to Trump. Who pays for tariffs?
Reporting by Brandi D. Addison and Kim Hjelmgaard, USA TODAY NETWORK / Austin American-Statesman
USA TODAY Network via Reuters Connect
