President Donald Trump has repeatedly and erroneously claimed that foreign governments are paying the entirety of his tariffs. While foreign exporters do pay a small fraction of tariffs, the truth is that the president’s broad-based tariffs essentially function as a tax on U.S. importers, and corporations have shifted most of the responsibility of paying tariffs onto American consumers through higher prices. The inflationary reality of tariffs for American consumers is widely accepted (by everyone except the Trump administration, apparently). However, U.S. companies are now surprisingly saying the quiet part out loud.
In industries across the nation—such as agriculture, transportation, and common household products, among other sectors of the economy—corporations are being unusually straightforward. In recent corporate disclosures, industry executives have publicly told investors they are protecting profits by passing the costs of tariffs on to consumers.
In a John Deere earnings call last month, company leaders explained their tariff bill will double from $600 million in 2025 to $1.2 billion in 2026. Corporate executives said they will “capture the incremental exposure” of tariffs by adjusting their “price/cost expectations for 2026” to be “inclusive of tariffs.” In other words, John Deere leadership seems to be telling investors not to worry because they will shift their tariff costs onto American customers by raising prices on tractors, harvesters, and other agricultural equipment.
At a December conference, ITT Inc.—a multi-billion-dollar manufacturer of transportation, aerospace, and industrial products—told investors it increased prices as a response to tariffs. Company leadership acknowledged that tariffs continue to create disruptions for their business but said the “customer is taking care of tariffs.” Americans can expect higher prices on brake pads and shock absorbers in addition to other products and services that ITT and similar companies provide.
Newell Brands—the corporation behind Sharpie, Elmer’s Glue, Paper Mate, Yankee Candle, and other household products—indicated in a December presentation that they raised prices on products multiple times in response to tariffs. Company executives stated they increased prices “early and pretty aggressively” on their products, specifically mentioning baby gear like strollers.
While targeted tariffs can be an effective instrument of reasonable trade policy, the president’s universal tariffs (widely implemented across industries and nations) are raising prices. American manufacturers are facing financial hits as a direct result. However, the strain is most significantly felt by everyday American consumers who continue to face higher prices.
Tariffs have been wrongly portrayed to the public as a costless alternative to taxes. Tariffs raise some revenue, but they do not generate nearly enough to replace existing tax systems. Furthermore, these recent disclosures from corporations explicitly demonstrate that the president’s tariffs impose substantial domestic costs. While the executive branch refuses to acknowledge the impact of tariffs on the country’s deepening affordability challenges, the experiences of consumers and direct statements of U.S. corporations expose a completely different reality.
