• Sceptiksky@leminal.space
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    3 小时前

    Wouldn’t refunding the amount of the tariff to the customer fix this? Ignoring the very important diplomatic and retaliation tariffs which makes the whole post unusable for real life

    • Canada sells a product A $100.
    • Tariffs makes it $120 when you buy it
    • so Canada gets $100, USA gets $20, USA customer pays $120.
    • USA has now $20, they can directly refund the customer for $20 via a policy to reduce the price of the category of A.
    • So customer gets $20 reduction of the product A via tax something, so USA now has $0 and USA customer actually paid only $100.
    • Except now if USA company make the product A they can sell it for like $100 and customer pays $80.
    • There is a slight increase of imported goods price here because tariffs cannot actually refund $20, it will be a % of the local vs imported production.
    • Over time you can expect to get a local advantage because of this price inequality, so local companies will be subsidized by imports until imports are no longer significant.

    Where am I wrong here ?

    • Dnb@lemmy.dbzer0.com
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      2 小时前

      In your scenario how is the local made $100 item bought at $80? Where is a $20 refund paid from? You are double spending it on both imported and local goods