Our 10% Tariff on $200
billion of Chinese imports would produce $20 billion in US federal revenue and
may result in a $20 billion increase in cost to corporations, some of which may
be passed on to US consumers.
But corporations already
had a tax cut of 14% in the corporate tax rate from 35% to 21% and should not
have a problem giving some of their tax cut back to the government in the form
of Tariff charges for a while. There are some costs and risks changing vendors,
especially when the goal is to completely eliminate tariffs. But most other
countries are interested in taking this business hoping for a long-term
relationship
If US corporations can
divert their manufactured imports from China to another country like Vietnam or
Indonesia, they could dodge the Tariffs completely.
Tariffs on Chinese
food are easier to deal with, because all countries produce food. There are few
costs or risks to changing food vendors.
Food is traded and priced globally.
The 25% tariffs on
steel and aluminum will need to last until the US plants become operational and
increase their productivity. The Tariffs
will result in cost increases for corporations that use steel and aluminum, if
they continue to import these commodities. The oil and gas pipeline
construction underway will need to absorb these costs until the US steel and
aluminum plants can improve their processes to increase through-put and lower
costs.
Trump’s use of Tariffs
should convince other countries to get serious about providing their own
products for domestic consumption and attending to their own trade policies.
Trump is challenging all governments to put their own countries first and allow
them to become great again. If they do this, their countries will prosper to
benefit their citizens and enable them to restore stability.
Norb Leahy, Dunwoody
GA Tea Party Leader
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