Last week we highlighted the state-by-state breakdown of tariffs paid on imports from TPP countries. Today, we are looking at the same data but from a slightly different angle: the average tariff faced on dutiable imports (i.e., those that already face no tariffs from any country). As shown in the map below, these average tariffs can be very high.
While Wisconsin faced the highest average tariffs at 14.2 percent, four other states including Vermont, Maine, Kansas, and New York also faced average tariffs of over 10 percent. These average rates may seem implausibly high given the common talking points about low U.S. tariffs, but imports of clothing and footwear often face tariffs of 20.0 percent or more.*
Products facing the highest tariffs typically would be subject to the longest tariff phaseouts under TPP, but that is not always the case. Many footwear and travel goods would be duty free on day 1 of implementation, as well as some apparel products like cotton sweaters (assuming they can meet the rules of origin). Even those products where some tariffs would remain for 10 years, such as women’s cotton trousers, would see tariffs cut in half upon implementation (again, subject to meeting the rules of origin).
Before any of these tariffs can be eliminated (or reduced), Congress must first pass legislation approving the TPP. The sooner it does, the better for American companies facing some very high taxes on imports from TPP countries.
* To be clear, states don’t pay or even collect the tariffs; importers pay the tariffs to the federal government. Estimates are based on national data on tariffs collected and the state import data using the Census Bureau’s “state of destination” definition. These average tariffs exclude imports of products that do not face tariffs from any country and therefore could not be reduced by congressional passage of the TPP.