Wednesday, August 14, 2013

The Sales Tax Holiday for back to school shopping is nice, but the real money is in tariffs levied on imported back to school items. How about a "Tariff Holiday". See here how much that adds up to.

Here is a nice graphic showing common back to school items parents purchase and the tariffs, in percent, that are embedded in the price you pay for these items.

A tariff is the same thing as a tax and is levied on an item when it is imported into the US.  The over-all goal of a tariff is increase the price of the imported good in order to make it more comparable to the price of the same (or similar) domestically produced good.  The assumption is the price of the imported good is too low for domestic producers to match.

While the State you live in might give you a break during the Sales Tax Holiday, the Federal government keeps on charging you.  A "Tariff Holiday" would REALLY help low income parents buy what they need for their kids.  How about it, Congress?

It really adds up, doesn't it?
Source: The Foundry (Heritage Foundation)

Note: Tariffs are applied to the cost of the good at the time of import, not on the retail price.

Example: Tennis shoes.  If the import price of the shoes is $10 then the 20% tariff is applied on the $10 not, say, a $20 retail price at Payless Shoes.
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