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Tim Nesbitt's avatar

I'm surprised by how many of our fellow citizens think tariffs on Chinese goods are paid by the Chinese. Not so. Tariffs on other countries' products are paid at our border by purchasers in our own country. That hardware store down the street that got another order of shovels from China also got a new bill to pay from our customs agency that will be paid directly to the U.S. government. It's not just a hidden tax, it's a hidden point-of-sale sales tax, or its cousin, a passed-on gross receipts tax -- something, in either form, that Oregonians have a contentious history with. Just like a sales tax or a gross receipts tax, some of the effects of the tax may ultimately be absorbed by the Chinese producer, if they reduce prices to remain competitive. But those downstream effects are small; meanwhile the initial tax incidence (a technical term for who pays in the first transaction) will be borne in full by the U.S. importers and passed on in large part to U.S. consumers. Small manufacturers and niche businesses will be hit hardest by that, while Amazon and Wal-Mart will adjust. They have pricing power that small businesses don't have. Add to your list of ironies that Oregonians, so averse to a sales tax (soundly rejected in nine different statewide votes), and those who complained about the business activity tax enacted here in 2019 are turning a blind eye to the effects of tariffs on their household budgets.

By the way, that 2019 business tax (which I viewed at the time as a good way to improve out K-12 system) showed up as a separate item on the invoice for my last car purchase. But, to your point, at least it was transparent to the voter and to me as a consumer and, I would add, has been helpful to my local school district. Nothing in Trump's tariff regime will have a useful purpose of that kind; it's just leverage for him politically and, incidentally, a new source of money for the U.S Treasury (paid by us as consumers) to blunt the impact of his deficit-driven budget bill and the tax cuts it will deliver with the greatest benefits to the wealthiest among us.

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Nelle Moffett's avatar

My Dad was born in 1905 and lived through the depression. He was a minister, raising 4 children before churches started to recognize that ministers had the same expenses as everyone else. As a discipline in honesty (and a necessity) he carefully budgeted every penny - and when I received an allowance as a child to cover school lunch, tithing, and other real expenses (not comic books!), he required me to budget and keep an account of every penny. It was a practice of integrity and responsibility, which I carried into adulthood.

Thank you for your integrity.

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