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Please explain WHY the tariffs foreign sellers pay to sell to the US should be less than what US sellers pay to sell to foreign countries. I’ll wait.
The basic premise of your question is understandable. Unfortunately, like most people, you don’t understand that tarrifs are paid by the US buyer not the foreign seller. No matter how many times that is explained, many people can’t or don’t want to understand that.
Dominic, first – foreign sellers (exporters) do not “pay to sell to the US” tariffs. Tariffs are paid to the US Treasury by the importing (purchasing, not selling) companies (US businesses). Sometimes equalizing tariffs can make sense, but not always. That simplistic equation disregards issues such as scarcity, our export goals, national security, etc. The important thing to remember is that the funding for tariffs the US imposes comes from inside our own borders and foreign trade management is more complicated than the taxation aspect.
Well, it really isn’t all that simple. International trade is very complex and has always been recognized as such.
The U.S. has historically negotiated trade agreements that reduce tariffs on foreign goods in exchange for other economic or strategic benefits and some countries maintain higher tariffs to protect their domestic industries, while the U.S. has often pursued lower tariffs to encourage free trade.
At the same time lower tariffs on foreign goods can help keep prices lower for American consumers, as imported goods become more affordable while higher tariffs imposed by other countries on U.S. exports can be a form of protectionism to shield domestic industries from American competition. Of course, it goes without saying, other countries may impose higher tariffs on U.S. goods in response to past trade disputes or as a way to counteract U.S. trade policies.
The concern, of course is, that if the U.S. raises tariffs, foreign nations may respond with their own increases, creating an ongoing cycle. It has also been a common practice that some nations, especially developing economies, are granted lower tariffs or exemptions under international trade rules to help support economic growth.
Political choices do have consequences, as many Hoosiers are likely to find out.
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