A new Kiel Institute analysis reveals that American consumers and importers bear nearly all costs from 2025 tariffs. Using shipment-level data on $4 trillion in trade, researchers found foreign exporters absorbed only about 4% of the burden. The remaining 96% passed through to US buyers, driving a $200 billion surge in customs revenue.

The study examined discrete tariff shocks on Brazil and India. Indian export customs data confirmed exporters maintained prices and cut shipments instead of absorbing costs. This near-complete pass-through to import prices contradicts claims that foreign producers shoulder tariffs. The economic outcome functions as an own goal for the US, increasing costs for domestic buyers.

This research provides concrete evidence for ongoing trade policy debates. It suggests tariffs operate primarily as a tax on domestic consumers rather than a tool to pressure foreign competitors. The findings will likely influence future discussions on trade strategy and economic impacts, highlighting how trade volumes collapsed when prices didn't adjust.