The Trump tariffs scam in a nutshell

[dalton99a]

From NYT comments

[leftstreet]

1. DURec

[Roy Rolling]

37. Not a logical step

The wealth is not transferred from consumers to capitalists, the wealth is transferred from consumers to the government, the feds in the above analogy.

No capitalists are uniquely involved in the tariff process—a tariff “tax” is equally levied on capitalists, anarchists, and communists the same.

[Irish_Dem]

2. The companies will then be expected to donate some of their profits back to Trump.

[MichMan]

3. The state it was sold in made additional sales tax revenue due to the tariffs as well

By taxing a tax. They should have to refund that back to the consumer.

[Fiendish Thingy]

4. Except sector tariffs like auto parts are not covered by the SCOTUS ruling

Only items tariffed under IEEPA.

The issue of refunds will be tied up in court for years, perhaps only being resolved by some sort of blanket bailout legislation by congress to the importers, who will have detailed records and receipts of the exact amount of tariffs paid.

Meanwhile, numerous small businesses that can’t afford lawyers will go out of business.

Highly unlikely any individual consumers will see refunds, as it would be nearly impossible to calculate…

“I’ve saved all my receipts for all the Chinese made junk I bought at the dollar store…”

[Randomthought]

5. No incentive to lower price

As now the hypothetical auto parts store knows they can sell the battery for $250.

[dalton99a]

8. +1. Corporations rarely lower prices once they have raised them.

[Probatim]

20. That's the most important aspect of this.

Prices went up during COVID and stayed up because consumers would pay - and now corporations will do it again.

[Tasmanian Devil]

33. And their competition raises prices as well

And even those that don't have to pay tariffs raise their prices because consumers are used to seeing the higher price. Blame it all on tariffs and inflation and are ignorant of wild corporate profits.

[ColoringFool]

6. A Different Nutshell Heard From: The Tariff Monies Went Straight Into....

A Trump account in Switzerland.

Besides trafficking in minors, Jeffrey knew a heckuva lot about acquiring and keeping gigantic sums of money.

[Wiz Imp]

25. That is not true. The tariffs went straight into the US Treasury.

[ColoringFool]

31. Is That Sarcastic Towards Me Or Trump?

🤔

[Wiz Imp]

32. Wow.

There is no special Trump Swiss account for tariffs. I can't believe anyone would actually believe such nonsense.

https://www.marketplace.org/story/2025/06/20/where-is-our-tariff-revenue-going

But if everything goes smoothly, the CBP sends tariff revenue to the U.S. Treasury’s general fund, which is where our federal income taxes also go.

The president, the Treasury Secretary and the CBP do not have the discretion to spend that money.

“President Trump, will sort of talk as if he's got this money that can be spent. It cannot be spent unless Congress authorizes and appropriates it to be spent for a particular purpose,” Meyer said. “It's just a tax in the same way the president cannot just turn around and spend the income tax dollars that the IRS collects and remits into the general revenue of the Treasury.”

[Bluetus]

34. I don't think anybody questions that the tariff money goes to the Treasury. That's the wrong question.

The pertinent question is where did the money go in the many cases where Trump threatened huge tariffs on countries and industries, then a few days later, after bribes were obviously paid, the tariff threat just vanished.

That is potentially billions of dollars that flowed into Trump-controlled PACs, the Inaugural fund, the ballroom fund, Trump crypto and all the other structures Trump set up for taking bribe money.

[Wiz Imp]

35. I agree with that.

but the OP originally said: " The Tariff Monies Went Straight Into A Trump account in Switzerland" which is crazy. If they had referred to the bribes and not the actual tariff money, then I never would have responded to begin with.

[ColoringFool]

36. Well, That Tidy Little Sum Of $10 Billion For The "Board Of Peace".......

Money controlled solely by Donald J. Trump in (his) perpetuity, has to come from somewhere.

But hey---far be it for me to suggest that Trump is a Grifter Extraordinaire.

[gulliver]

7. Agree, but it's missing one step

The price needs to go back down to $200.

[bsiebs]

10. ha ha ha ha ha ha ha haha haha ha ha ha ha ha ha

… you forgot the sarcasm emoji…

[gulliver]

12. Lol

[Shermann]

9. Tariffs are just baked into the price and aren't listed separately on invoices provided to customers.

The traceability is severed at the manufacturer or retailer. It's nice to daydream about refund checks though.

[Ms. Toad]

11. Yes and no.

Not all of the tariffs were passed on to the end consumer. Some importers absorbed some of the costs because they knew consumers would not (immediately at least) pay the full 250 in your example - so, rather than go out of business, they made an assessment as to how much consumers would be willing to pay - and how much they could absorb at least temporarily.

So in the example in the OP - they might have priced it at $225, so they still made their $100 profit, but not an additional profit based on doubling the price. Or they might have priced it at $213 (eating half of the tariff cost, cutting their profit to $88, rather than $100 - expecting to gradually raise prices so at least the full cost of the tariff was covered).

So it is a complex calculation to determine what share of the tariffs were paid by the consumer v. manufacturer, based on news reports and investigative reporting I've listened to since the tariffs were implemented.

But the bottom line point is correct - if all of the tariffs are returned to the importers, the importers who are still in business will make an additional profit because they would have been made at least partially whole by the customer, and more than whole by the refund of the tariffs. And - we can't depend on the importers to refund money to the end consumer.

It will be an interesting class lawsuit by consumers, assuming the importers get a tariff refund.

[progressoid]

21. Thanks.

Save me a lot of typing.

[Bluetus]

13. This is a very real scenario. And nosice there was an extra $25 of price gouging in this example.

Pre-tariff, this hypothetical company had a gross margin of $100 per sale. When the $25 Trump Tariff Tax was imposed, this hypothetical company jacked up the price $50 with "Hey, I have to raise prices because of the tariffs. Don't blame me." So in this example, the customer paid the $25 Trump Tariff Tax, plus another $25 of price gouging.

And now the company gets the $25 back, so the customer is out $50 in this deal, and all of that goes into the pocket of the company.

[dalton99a]

16. +1. Companies have also been raising prices because of "oh, inflation"

Those prices ain't coming down

[popsdenver]

22. All of the corporations

raised the price of everything the last year Biden was in office, just to help Trump make it look like Biden was the cause of all of the inflation. However, if you looked at the corporation's sales, there was an additional amount of RECORD profits........showing what was really going on........
The Corporations are pleased that they are reaping the profits, since they are the ones that make outrageous donations to the Republican Party, and are getting exactly what they want in return.
No small wonder they didn't lower there prices back down to where they were, the execs were incredibly happy about their increased bonuses.......

When they figure the inflation, the Consumer Price Index has been crooked since Reagan rigged it in the 1980's.
And you can be certain that it doesn't factor in the "SHRINKAGE" in the quantities size which is at least 30% more.......

The United States of America.....should be re-named: The United Corporations of America
A direct consequence of the Supreme Court's passage of: Citizens United in 2010

[dalton99a]

29. Yep, purely profit-driven.

[Bluetus]

30. There is a simple solution to most of our economic issues

A top tax rate of 70-90%

That's where it was when we built the most successful middle class the world has ever seen, and the strongest economy with the greatest innovation.

We don't tax any profits that are put back into R&D, new factories, new processes, new machinery, or employee benefits such as improved wages, health care, and education reimbursement. With a top rate of, say, 80%, a highly successful company can pay very little tax, simply by investing in its business and its people.

Yes, that hurts the luxury yacht industry, but it benefits just about everybody else. And guess what? Executives still make enough money to have a really nice life with no financial cares in the world.

[2naSalit]

14. There it is.

[Demixs]

15. Pretty much

Spot on.

[CaptainTruth]

17. I've always said tariffs tranfer money from consumers to the Treasury.

It's a shell game Republicans play, pretending to put money in your pocket with their left hand via tax cuts, while taking money out of your pocket with their right hand via tariffs, which go into the Treasury.

They give the biggest tax cuts to the wealthy donors who fund their political campaigns, tax cuts which are money out of the Treasury. So, in a round about way, we're all being forced to help fund Republican politicians' campaigns, against our will.

Follow the dollars & see where they ultimately up.

[Ol Janx Spirit]

18. Exactly--it is a potential windfall for companies that passed the tariffs straight on the the consumers.

The records that the government has account for every cent a company paid in import taxes. That will be easy to refund--and there are already mechanisms in place to do so.

Not every company passed those tariffs on, however--so they will only be made whole for their initial tariff tax costs.

But if your company did pass those costs on and you get a refund for what you paid then it's just a windfall for you unless there is a requirement to somehow pay it back to the consumers--a process that would probably cost far more than it is worth if you sell lots of products to consumers through retailers.

So, you paid the tariff tax; you recouped the tariff tax from your customer; and now you get a big fat check for the tariff tax you paid that you get to keep....

Calculating what an individual consumer paid in tariff taxes and additional sales tax, etc., is basically impossible.

Also, if a tariff tax raised the price of a non-tariffed item--which is of course the way it works when your competitor suddenly has to raise their price and you can raise yours to just a hair under that--then how can that cost to consumers possibly be calculated?

No, as always, the easiest thing to do will be to shower corporations with money that they can do whatever they want with--most likely giving it straight to executives as always.

And of course, the prices aren't coming down on either the tariff-impacted products or the ones that just went up because they could any time soon....

[xuplate]

19. Good luck ever seeing a penny of that refund.

Trump and Bessent will find s way to split it 90/10.

[Mr.Bee]

23. THIS!

is how he pays off his donors

[debsy]

24. They are robbing us blind in so many ways!

[MadScout]

26. It's been a total crap shoot

I import airbrush equipment from Taiwan for face and body art.

Each month the tariffs were different, ranging from 10% to 50% for the same merchandise, from the same manufacturer, with the same shipping company.

It’s been impossible to keep pricing consistent.

I decided to split the difference by including free airbrush stencils equal to the increase in cost.

It made my customers “whole” while minimizing my lost profit margin since I have the stencils cut here.

[themaguffin]

27. We will never see a dime. I doubt companies, who technically paid the tariff will either.

[vapor2]

28. Greedy grifters.......ALL of them

enriching themselves off taxpayers. WE will NEVER see any return from these bastards