Where Does the Money from Trump-Era Tariffs Go?
If the U.S. government puts a tariff on items imported from China that would affect their trade.
Some individuals believe that China has to pay this tax. Nevertheless this isn’t the accurate way things are done. Any t-shirts bought in the U.S. from China are subject to tax when they reach the country. This means American companies need to cover the cost of the extra taxes.
This leads the firm to charge more for those t-shirts whenever they are sold in shop. In other words you as a customer have to spend more. Occasionally the company pays for everything which cuts their profits. This may be negative for their business activities.
Tariffs collected by the government are kept in the U.S. Treasury which is the government’s central bank. Government uses the money just as it would any other kind of tax for roads, schools and the military. It is not planned for a unique reason. The government uses revenue from the tax for its everyday expenses.
Sometimes the government receives money from tariffs but this often causes the prices of goods in the U.S. to rise. Additionally other countries might add tariffs to the goods they buy from the United States. Because of this both companies and customers in America usually discover the effects early on.
