145% Tariff Hike on Chinese Goods: What It Means for Your Store

On April 10, 2025, the U.S. government announced a major escalation in its trade policy against China—raising tariffs on Chinese imports from 84% to 125%, and imposing an additional 20% tariff on fentanyl-related products, bringing the effective rate to 145% for certain categories.

In response, China imposed a 125% retaliatory tariff on all U.S.-origin imports and is preparing to file a formal complaint with the World Trade Organization (WTO).

This aggressive tariff move has wide-reaching implications—not only for international diplomacy and economic stability, but also for your store if you rely on Chinese suppliers.

 

 

What Has Changed?

• Tariff raised to 125%, plus 20% fentanyl-related surcharge = Effective 145% on select goods.

• China retaliates with 125% tariffs on all U.S. imports.

• China to file a formal WTO dispute.

• Duty-free exemptions for imports under $800 are now suspended, directly affecting platforms like AliExpress, Shein, and Temu.

 

These decisions come at a time when tensions over trade and security are growing, and global markets are bracing for further instability.

 

These tariffs most likely concern you, as you have a store to run. Like most savvy entrepreneurs, you've established an effective supply chain to source high-quality products from China or plan to do so. Read on to learn how the tariff on Chinese goods will impact your store. 

 

The Economic Fallout

 

Impact on Chinese Exports

• Auto, electronics, and solar sectors face massive hurdles.

• China’s car parts exports to the U.S. totaled $17.15 billion in 2024, representing 15.6% of total exports in that category. This may decline sharply.

• Fortunately, China's domestic demand is rebounding—in Q1 2025, 75% of GDP growth was driven by internal consumption, absorbing some export-side pressure.

 

Impact on the U.S. Economy

• According to the Peterson Institute for International Economics, over 90% of U.S. tariffs on Chinese goods are absorbed by American importers and consumers.

• U.S. March CPI rose 2.4% YoY, but wage growth lagged behind spending, deepening real income strain.

• Manufacturers relying on Chinese raw materials and components are facing rising costs and shrinking profit margins, weakening global competitiveness.

 

Global Disruptions

• The tariffs are disrupting established global supply chains, prompting companies to rethink sourcing and production strategies.

• The WTO warns that if the U.S. maintains elevated tariffs, 2025 global GDP growth could dip below 2%.

• Countries including the EU and ASEAN have criticized U.S. unilateral actions, adding to geopolitical and trade uncertainty.

 

 

What Store Owners Need to Know

 

Of course, this will also impact your business, especially if you sell affordable products from TVCMALL, like car accessories, cell phone accessories, and consumer electronics, to your customers in the US. You may need to absorb some of the costs to keep your products competitively priced, and customers may have to wait longer for their packages to arrive as these undergo custom checks. 

 

Furthermore, the Trump administration has imposed a 25% tariff hike on aluminum and steel. This is a wide-reaching tariff because it also includes products made from aluminum and steel, impacting imports like appliances, cars, and consumer electronics, to name a few. 

 

Tariffs Currently Apply To:

 

1.Electric vehicles (EVs)

2.Face masks

3.Lithium-ion batteries for EVs

4.Non-lithium-ion vehicle batteries of non-EVs

5.Non-lithium-ion battery parts

6.Medical gloves

7.Permanent magnets

8.Semiconductors

9.Solar cells

10.Syringes and needles

 

What are tariffs in trade?

 

Governments often impose tariffs, a form of taxation, on products imported from foreign countries. This seems counterintuitive, as it drives up the cost of these products for consumers within the country that introduces the tariffs. However, these tariffs inevitably drive local consumers towards domestic products, which will appear more attractive due to their lower prices.

 

One of the main reasons a country introduces tariffs is to balance its trade deficit with specific countries. When a country imports more products than it exports, it's affected by what's known as a negative balance of trade (BOT) or trade deficit. 

 

A secondary reason for the tariffs is that they act as an income source for the government. Before the US government introduced federal income tax in 1913, it relied heavily on tariffs to fund its public service and infrastructure programs.

 

While tariffs may impact consumers, they pose a significant challenge to businesses. As a store owner, you must adjust your plans and pricing strategies to any tariffs and subsequent tariffs imposed in markets you compete in. If you fail to do so, you won't be able to react in time to sudden price fluctuations and deliver competitively priced products to your customers.

 

In Conclusion

 

The recent tariffs on Chinese imports are unfortunate. Consumers will feel the pinch since they must pay higher prices for the goods they want and need. Tariffs also put additional pressure on your business, as you must contend with a more unstable global trading environment. 

 

So, you'll need to bring your 'A' game and be ready to adapt your pricing strategies to remain resilient. But you can improve your odds by partnering with TVCMALL, which offers the products, tools, and support to help your store THRIVE!