August 02, 2019 "Information Clearing House" -  With US President Donald Trump's announcement on Thursday of tariffs on another $300bn of Chinese imports, nearly all goods from China will be subject to import taxes, and Trump says they generate billions of dollars in revenues for the US Treasury from China.

But that is not how tariffs work. China's government and companies in China do not pay US tariffs directly. Tariffs are a tax on imported products and are paid by US-registered firms to US customs when goods enter the United States.

Importers often pass the costs of tariffs on to customers-manufacturers and consumers in the US - by raising their prices. US business executives and economists say US consumers foot much of the tariff bill.

That was why, immediately after Trump announced his decision, US retailers blasted the move as "another tax increase on American businesses and consumers," which they warned would threaten US jobs and raise costs for American families.

The new levies will hit a wide swath of consumer goods from mobile phones and laptop computers to toys and footwear.

Stephen Lamar, executive vice president of the American Apparel & Footwear Association, said the new tariffs would hit US consumers much harder than Chinese manufacturers, who produce 42 percent of apparel and 69 percent of footwear purchased in the US.            

Investors are worried that the increase in retail prices will hit consumer spending, which has underpinned the US economy, and trade uncertainty makes businesses hold back capital spending.

'Tariff Man'

Trump says the US will be "taxing" China until a trade deal is secured. He has called himself the "Tariff Man," often repeating that China pays for US tariffs on its goods.

On May 5, he tweeted: "For 10 months, China has been paying Tariffs to the USA".