pThe Supreme Court struck down a broad set of global levies back in February. The President replaced them with a new 10% global tariff using a different legal authority, but that levy was
limited by law to 150 days
That period ended Friday.
On Thursday, the President rolled out new tariffs of 10% to 12.5% against more than 80 countries, including most of the U.S.’s biggest trading partners, using a different legal authority. This means that most imports will continue to face tariffs similar to those incurred over the past five months.
The latest tariffs rely on Section 301 of the Trade Act of 1974. Viewed as more legally durable than other duties struck down by the courts, these are aimed at countering the loss of U.S. business from the use of forced labor in the materials or production of goods exported to the U.S.
All of this reshuffling might matter less than it looks. Analysts estimate that the effective tariff rate on U.S. imports will stay near 10%, which is similar to most of this year so far.
American businesses have navigated the President’s trade war in a nimble fashion. That has enabled managers to make fast supply-chain adjustments and well-informed pricing decisions.
This past week, General Motors said that it expects gross tariff costs of $2.5 billion to $3.5 billion for the year, but Chief Executive Mary Barra described better than expected profitability estimates. “We haven’t made excuses,” Barra said. “We’ve just continued to perform.”
The clearest consequence of the President’s tariffs has been higher prices for physical goods, from clothing to televisions and furniture. Tariff costs have added anywhere between $1,600 and $9,000 to new-car prices this year, according to Kelley Blue Book.
Economists at The Fed estimate that through February, the levies broadly lifted the cost of core goods by about 3.1%. That is a sizable shift given that goods prices mostly fell during the decade leading up to the C19 Pandemic.
But the majority of U.S. consumer spending goes to services. So the increases in prices of goods caused by tariffs have overall had a far smaller effect on overall inflation.
All told, the Fed economists put the tariff effect on core consumer inflation at about 0.8%. Outside of inflation, tariffs haven’t placed the economy under much strain.
The economy grew an inflation-adjusted 2.7% between the first three months of 2025 and the same stretch of 2026, propelled by solid consumer spending and the artificial-intelligence investment boom.
But so far, the tariffs haven’t done much to advance two of the administration’s central goals which are closing the trade deficit and reviving factory jobs. Through the first five months of 2026, the U.S. trade deficit totaled $297.91 billion, down about 10% from the same stretch of 2024.
Although factory output is up 3.1% since the new administration returned to office, the sector employs fewer people. Roughly 75,000 fewer Americans worked in manufacturing in June than in January 2025.
The President’s trade team is selectively stepping up tariff pressure elsewhere. The administration has outlined steep tariffs on a range of Canadian goods beginning next month, a threat widely read as leverage ahead of renegotiation of a key trade pact, the U.S.-Mexico-Canada Agreement.
The administration is also working to impose another broad tariff in response to excess production capacity overseas that drives down prices for products made in America. And on Friday, the President said in a social-media post that his team was exploring new tariffs against the European Union in retaliation for fines against U.S. tech companies.
Let me leave you with this…
Just because you’re not hearing about this nightly on the 6 o’clock news doesn’t mean that it’s over. It’s very much alive.
Generally, the U.S. has always imposed tariffs of one sort or another. What’s different this time is the broad range of tariffs against virtually all of our trading partners at the same time.
I wanted to write about these today, because of a conversation I had with a client last Friday. When I mentioned that a new round of tariffs had been ordered, the client said, “Really?
Are those still happening?”
Yes, they are. And they’re still something that all entrepreneurs need to be mindful of and guard against.
Things seem to have evened out, as is common in capitalist economies when a new economic force is introduced. In response, Entrepreneurs are doing what we do best.
We make the necessary adjustments and keep rolling along. But to make those adjustments, you need to keep watch.
No one needs to be blindsided by any of this.
Watch your monthly financial statements like a hawk. Watch your labor. Maintain your margins.
The worry is that these changes aren’t front and center on the 6 o’clock news anymore. Something might be ordered that could throw your world into a tizzy.
Be vigilant my Brothers and Sisters. The company you save could be your own.
As always, if you’re having problems with your accounting and tax work, please don’t hesitate to contact us.
We’re all going to get through this. Let’s get through it together…
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Payroll Services, Accounting and Tax Work, Tax Planning, or Tax Representation, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
888-310-0300
www.AccountingSolutionsLtd.com
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