It seems (and correct me if I am wrong) many people don't understand how tariffs actually work. China, or Chinese companies DO NOT PAY THEM. Americans who import, whether it be individuals or companies do. I suppose there will be instances of Chinese subsidiaries (such as BYD in the US) paying but they would be American based.
I am not being political as this issue will impact investors, I just feel many people don't discuss the fundamental basics, and this may drive poor investment decisions.
Obviously (to me anyway) a Chinese company is not expected to send money to the US treasury, that would be absurd (same way US companies would not pay the CCP).
On top of this, usual 'de minimus' exception (where anything under 800 USD is duty free) has been scrapped, with a minimum of 25 USD per order.. so e.g. those 2 USD phone cases now have 25USD tariffs.
Do people get this? Am I stating the obvious? I keep watching media and it seems these basic facts are not being explained?
I am not aiming for debate. Watching news, reading the newspaper, seeing comments etc where people seem to think China pays, whether it be Chinese companies or the Chinese government. The idea the Chinese state would pull out a visa card and pay the US treasury is bonkers, isn't it?
Edit: I suppose you could argue 'China' pays indirectly by absorbing the tariff as reduced profit.
Edit 2: Someone below mentioned the tariff applies to import cost (not retai) which is an important caveat to mention me thinks.