A new report indicates that American consumers are shouldering the majority of costs associated with U.S. tariffs, with an overwhelming 96% of the financial burden falling on them rather than foreign sellers. This finding comes from research conducted by Germany”s Kiel Institute for the World Economy, which analyzed trade patterns during a significant period of tariff increases.
The study examined nearly $4 trillion in international shipping data from early 2024 to late 2025, revealing how U.S. tariffs have transformed the landscape of global commerce. The analysis tracked the flow of goods, scrutinizing shipping records to determine the financial impacts on American buyers and businesses.
According to the researchers, the financial impact of increased tariffs primarily affected domestic households and import companies. The data showed that only about 4% of the additional costs were absorbed by foreign suppliers, who made minor price adjustments. The bulk of the increased expenses—96%—was passed on to American consumers, leading to higher prices for everyday goods.
As tariffs on imported goods rose, American importers faced escalating costs, which reverberated through the supply chain, ultimately reaching consumers at retail outlets. The study suggests that the financial pressure did not originate from foreign suppliers, but rather from domestic consumers and businesses that had to pay more due to these tariffs.
Julian Hinz, an economist involved in the research, expressed skepticism about previous assumptions regarding tariff burdens, emphasizing that American importers and households are the true bearers of the estimated $200 billion in tariff revenue collected over the past year. While some foreign suppliers made small price reductions, these were insufficient to offset the impact of U.S. tariffs.
Interestingly, the study also noted a significant reduction in the volume of goods imported from countries like India, where suppliers opted to maintain prices instead of lowering them in response to tariffs. Shipments from India dropped between 18% to 24%, indicating that foreign sellers preferred to reduce exports rather than compromise their profit margins.
This strategy reflects a broader trend among international suppliers, who opted to retain pricing in the face of heightened duties rather than engage in aggressive price-cutting. As a result, while fewer goods entered the U.S. market, those that did remained at elevated prices, further straining American consumers.
The report underscores the complexities of international trade and the implications of tariff policies on domestic economies. It highlights the need for American consumers to be aware of how these economic measures can affect their purchasing power and overall financial health.
