MENA Newswire, WASHINGTON: A new study by the Kiel Institute for the World Economy finds that Americans, not foreign exporters, are paying nearly all of the cost of recent U.S. tariffs, as import prices rose almost one-for-one with the duties. The researchers estimate that foreign firms absorbed only about 4% of the tariff burden, while roughly 96% was passed through to U.S. buyers, challenging political claims that tariffs are financed abroad.
The analysis draws on shipment-level records covering more than 25 million U.S. import transactions valued at nearly $4 trillion from January 2024 through November 2025. Using unit values and other shipment characteristics, the authors report “near-complete” tariff pass-through to U.S. import prices, indicating that the incidence of the duties fell overwhelmingly on American importers and, through the supply chain, on U.S. businesses and households.
The policy brief focuses on sweeping duties announced on April 2, 2025, described by the authors as a broad tariff shock that included a baseline 10% tariff on most imports, higher country-specific rates for many trading partners, and sector-specific tariffs on autos, steel, and aluminum. The study says tariff rates for China at points exceeded 100%, while other countries faced sharp changes that allow for comparison around discrete tariff increases.
In the authors’ baseline estimates, the measured response of exporter prices to higher U.S. tariffs was small, implying limited foreign price concessions. The study quantifies this as less than 4% absorption by foreign exporters, with the remainder passed through to U.S. importers. The report frames the result as a tariff burden that functions primarily as a charge paid domestically at the border and transmitted through wholesale and retail prices.
Shipment data show near-complete pass-through
To validate the findings, the researchers highlight event studies tied to discrete tariff shocks involving Brazil and India in August 2025. In those cases, export prices to the United States did not meaningfully decline after tariffs rose, according to the report. Instead, trade volumes fell, a pattern the authors describe as adjustment through reduced shipments rather than lower exporter prices. The brief also cites Indian export customs data indicating prices were maintained while shipments were cut when U.S. tariffs increased.
The report emphasizes that the first entities paying tariffs are U.S. importers and intermediaries that remit the duties at entry, with downstream effects on manufacturers and retailers that rely on imported finished goods or foreign inputs. The authors say consumers bear the ultimate burden through higher prices for imported products, higher prices for domestically produced goods that use imported components, and reduced variety as trade volumes decline.
Customs revenue rise highlights domestic burden
The study links the pass-through result to a sharp rise in U.S. customs revenue in 2025, estimating an increase of about $200 billion. The authors describe that surge as money collected from American buyers rather than a transfer from foreign producers, given the limited reduction in exporter prices measured in the shipment data. Using their incidence estimate, the report states that for each $100 in tariff revenue collected, about $96 corresponds to costs borne in the United States and about $4 reflects reduced foreign exporter profits.
The findings align with earlier research cited by the authors on prior U.S. tariff episodes, which also found that foreign suppliers generally did not offset duties through equivalent price cuts. The Kiel researchers conclude that the 2025 tariff increases largely raised the cost of imports paid by U.S. buyers and reduced trade volumes, rather than shifting the bill to overseas exporters through broad declines in export prices.