Trump Tariffs: Round 2 | Utah Taxpayers

If I had a dollar for every time I’ve heard or read the word “tariffs” in the last month, I might have enough to afford them. But what are they really, and do we have cause for concern?

The Trump administration is currently proposing or imposing tariffs on a variety of industries, products and countries ostensibly in an effort to promote American goods and production, retaliate against perceived injustices from other countries, and otherwise impose its will around the globe. The United States holds an incredible amount of spending power and is an essential trade partner to numerous nations and industries, making this strategy heavy handed and potentially very effective.

Although the entire effect of President Trump’s second term tariffs remain to be seen, we do know the following:

The tariffs imposed during President Trump’s first term and maintained through President Biden’s term were shown to raise prices, reduce output and employment, and produce a net negative impact on the US economy
Economists predict that the threatened tariffs will reduce US GDP
The average tariff rate of all goods would rise from about 2.5% in 2024 to 8.4% in 2025, making it the highest average rate since 1946
Tariffs could raise prices for consumers as the additional cost is passed to them
Price hikes caused by tariffs will be one-time increases and will not cause an inflationary spiral (according to Treasury Secretary Scott Bessent)

Governor Cox recently shared on X that, “excluding gold exported to the UK for refinement, Canada and Mexico are Utah’s two largest trading partners for imports and exports”, meaning Utah will feel the effects of President Trump’s proposals. The full impact, Governor Cox said in a recent press conference, will be studied by a team of experts as the data becomes available.

What we can take comfort in is Utah’s positive economic outlook (ranked #1 in the nation for 17 consecutive years), a decreasing income tax rate that leaves more money in Utahns’ pockets, and a well-diversified economy that will be able to withstand the turmoil of tariffs.