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TO THE EDITOR:
I was listening to a conversation the other day and soon realized that there are some people who do not understand what a tariff is and who pays for the tariff. Tariffs can be placed on a country which is happening as I write this, such as India, or on a commodity such as steel or aluminum. Either way it is a percentage placed against the value of a product, a tax, that must be paid by the company or individual that imports the item or commodity. Using India as an example, President Trump has threatened a 50% tariff on anything imported from India.
As an example, a manufacturer in the United States purchased an electronic component from a manufacturer in India and the tariff was 50%, how would the tariff affect the price? If that component had a value of $500, times 50% tariff equals $250, that $250 must be paid by the manufacturer in the United States when the item clears customs, making the cost of the item $750. The question now is, who will pay that extra $250, the manufacturer? The consumer who purchases the item from the manufacturer? Or will it be a combination of the manufacturer and consumer? Regardless the $250 tariff is a tax.
Thinking back to our primary education, all of us have heard about the Boston Tea Party, where tea was taxed by the King of England without consulting the thirteen colonies. Taxation without representation where the people of Boston broke into a ship with tea on-board and threw it into the harbor as an act of defiance. Tariffs imposed by the president on an arbitrary and capricious manner is taxation without representation. Congress as our representatives should be ratifying tariffs recommended by the president. This is not happening and regardless, you the consumer will be paying a percentage or all the tariff tax. Taxation without representation.
Where is our federal representative?
Myron Koets
DFL Chair Senate District 21