US President Donald Trump’s Chinese tariffs are on pause, bringing relief to many businesses and consumers. However, the 10% levy on all Chinese goods and the additional 20% tax related to fentanyl remain in place, effectively increasing the tariff rate on Chinese imports to around 40%.
This increase may not affect consumer purchases, such as underwear at Target, but companies relying heavily on steel, aluminum, semiconductors, and other materials will feel the pinch. The added costs of these products will likely be passed down to consumers.
Trump’s animosity towards China persists, and his past actions suggest a prolonged trade war is unlikely to be resolved quickly. In 2018, the Trump administration imposed significant tariffs on China and made demands for technology sharing, reducing the Chinese requirement for data theft.
The COVID-19 pandemic interrupted negotiations, and the Biden administration took over in 2020. However, it’s clear that Trump will continue to raise these issues, potentially leading to another trade war with China.
Some businesses are taking advantage of the tariff suspension to stock up on products from China or find alternative suppliers. Others are relocating manufacturing back to the US or adjusting pricing strategies to accommodate the changing market.
For companies heavily reliant on Chinese suppliers and markets, this pause is temporary relief at best. More tariffs and trade restrictions are likely to come, and the outlook for businesses remains precarious. With Trump’s volatility and history of antagonizing China, planning accordingly is essential.
Source: https://www.theguardian.com/us-news/2025/may/18/small-business-trump-tariffs-plan-impact