Richard Quest: Tariffs Are Either Eaten by the People in the Supply Chain or They Get Passed on to the Consumer

EXCERPT:

QUEST: “No, you don’t, is the short answer. The whole policy is riddled with contradictions. You just heard then the question of, you know, whether or not you can have affordability, whilst at the same time you’ve just increased the tariffs by an average of 17 percent. Somebody — look, Howard Lutnick just said, the Commerce Secretary just said $50 billion a month is coming into the Treasury, which is great because that will most certainly help cut the deficit. Not by as much as the Big, Beautiful Bill increased it, but it will help cut the deficit. But who is paying that $50 billion? From the day tariffs were mentioned, Fredricka, we’ve gone round in circles. It’s as if there’s just a — there’s a blind wall here. The tariffs are being paid by the manufacturer, the producer, the exporter, the importer, all the people in the supply chain who then either do one of two things. They either eat it or they pass it on to the consumer. And you can only eat a tariff of 30 percent, 25 percent, which cuts into your margins, for so long. So, yes, you are going to see an effect. You may not be seeing it now, but it’s on its way.”