Most economists says tariff is paid by the consumer. Some economists say it’s paid by the supplier. As a career sales professional in my past corporate life and a businessman in my current entrepreneurial journey, I believe such costs are shared by all parties<\/strong>. It all depends on margins, compelling need for the market and compelling need for the goods.<\/p>\n Going by my experience of conducting business negotiations for decades, I find no “idiocy” in Stephen Miran’s belief that “exporters pay for the tariffs levied on imports”. As the old Lotto Germany<\/em> billboard ad said, “Es tritt mehr als Sie denken<\/em>” (“It happens more often than you think”.) – exporters may pay for the tariffs levied in imports in more situations than economists can imagine.<\/p>\n Let’s take my industry, for example. I know my sales realization when I sell to USA versus other countries. Even after absorbing tariffs in the low teens, I’d make more money selling to USA than any other market in the world. So, as an exporter, I’d rather pay tariffs due on American importers than lose the lucrative American market. (Obviously this won’t work if tariffs are 145%).<\/p>\n Since there’s no Trump Tariff on my industry (knock on wood!), you might consider my example hypothetical.<\/p>\n So let me take a few examples from other industries where Trump Tariffs is real.<\/p>\n Though framed euphemistically as “requests for adjustment” by the media, their intent is unmistakably clear: American importers are asking overseas exporters to eat the cost of US tariffs by compromising their margins. While exporters can theoretically refuse, if they push back too hard in practice, they risk losing business from the world\u2019s largest consumer market.<\/p>\n The results of these adjustment requests have already started pouring in. According to Mashable<\/em><\/a>, Sony<\/em> just increased the price of its PlayStation 5<\/em> gaming console in Europe, the UK, Australia, and New Zealand. But its prices in USA haven’t changed.<\/em><\/strong><\/p>\n Then there are other shady developments. For example, according to the section titled Chinese suppliers are offering U.S. Amazon sellers a tariff solution, but it\u2019s not legal<\/a> of the Fortune Tech<\/em> newsletter dated 14 April 2025, Chinese exporters have offered to underinvoice their exports to buyers in USA in order to reduce the impact of tariffs.<\/p>\n While tariffs have theoretical underpinnings in economics, the above real-world outcomes show that professionals in tech, investment banking and private equity are better equipped to predict the fallout of tariff policies in actual practice. Being in deal-intensive industries, they make deals day in, day out, and understand the art of the deal like no sinecure economist ever can.<\/p>\n And no prizes for guessing which American President’s administration is full of such professionals!<\/p>\n Thanks and Regards.<\/p>\n KETHARAMAN SWAMINATHAN<\/p>\n 16 April 2025<\/p>\n Even if the market is big enough to absorb the entire output of the IT industry, one person month will fetch only $1000 in India vs. $3000 from USA, UK, etc. Salary indexes on value, not quantity, of sales. So Indian IT industry needs to export to deliver high SOL. pic.twitter.com\/wb2dJ9CBJm<\/a><\/p>\n \u2014 SKR (@s_ketharaman) April 23, 2025<\/a><\/p><\/blockquote>\n\n
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