Small businesses have sent out a warning to the Trump administration over new tariffs being levied on Chinese goods.
The White House has already imposed 25 percent tariffs on $50 billion in Chinese imports, as well as double-digit duties on steel and aluminum imports. Now the U.S. is planning to raise tariffs on $200 billion worth of Chinese products, from 10 percent to 25 percent. Chinese officials say the country would then retaliate on U.S. imports.
SMBs, along with economists and others, have warned that the new tariffs will result in higher costs for U.S. consumers, as well as hinder companies from hiring new employees and expanding their businesses. In fact, U.S. businesses have said that the existing tariffs have already added billions in costs and raised prices on numerous imports.
With the new tariffs, Robert Heiblim’s 25-employee company is facing a 25 percent duty on almost half of the consumer electronics they have made in China.
“I’m not Apple who can just say, ‘Well, if you want the new iPhone, it’s now $1,000,’’ said Heiblim, president of Boulder International in New Jersey, according to Bloomberg. “Suddenly, if you just need a whole lot more cash, it’s really disruptive.’’
He added that smaller firms often must pay the tariffs with cash they’d usually spend on hiring more employees, marketing or expanding their businesses.
Tom Lix, founder of Cleveland Whiskey in Cleveland, Ohio, added that he has not filled four positions that he planned to because of the tariffs.
“We are going to get hit across many industries if we head down this path,’’ Lix said. And although he had expected his company to grow as much as 20 percent last year, the tariffs caused it to stop shipping to both Europe and Asia in 2018.
“It’s made a big difference on our business,” he said. “Our access to capital was changed, the rate of financing for the business has changed because we can’t show that growth curve we had prior to 2018 because of our export business.”
And Tiffany Zarfas Williams, owner of Texas-based Luggage Shop of Lubbock, said she didn’t hire any holiday staffers and hasn’t filled any other positions because of the tariffs.
“It basically means 85 percent of what is in our store has been impacted by the tariff,” Zarfas Williams said. “I don’t know if I can blame it 100 percent on the tariffs … but because we’re seeing the greatest impact on some of our mid-priced and higher-end luggage, I think the customer noticed the price increase much stronger.”