- 'Little Gregory' murder haunts France 40 years on
- Tariffs, tax cuts, energy: What is in Trump's economic plan?
- Amazon wants to be everything to everyone
- Jewish school in Canada hit by gunfire for second time
- With medical report Harris seeks to play health card against Trump
- China-EU EV tariff talks in Brussels end with 'major differences': Beijing
- Buried Nazi past haunts Athens on liberation anniversary
- Harris to release medical report confirming fitness for presidency: campaign
- Nobel prize a timely reminder, Hiroshima locals say
- China offers $325 bn in fiscal stimulus for ailing economy
- Small Quebec company dominates one part of NHL hockey: jerseys
- Boeing to cut 10% of workforce as it sees big Q3 loss
- Want to film in Paris? No sexism allowed
- US, European markets rise as investors weigh rates, earnings
- In Colombia, children trade plastic waste for school supplies
- JPMorgan Chase profits top estimates, bank sees 'resilient' US economy
- Little progress at key meet ahead of COP29 climate summit
- 'Party atmosphere': Skygazers treated to another aurora show
- Kyrgyzstan opens rare probe into glacier destruction
- European Mediterranean states discuss Middle East, migration
- Thunberg leads pro-Palestinian, climate protest in Milan
- Stock markets diverge before China weekend briefing
- EU questions shopping app Temu over illegal products risk
- Han Kang's books sell out in South Korea after Nobel win
- Shanghai markets sink ahead of briefing on mixed day for Asia
- Investors, analysts eye bigger China stimulus at Saturday briefing
- Musk unveils robotaxi, pledges it 'before 2027'
- At least 11 dead in Florida but Hurricane Milton not as bad as feared
- Asian markets mixed after Wall St drop, Shanghai dips before briefing
- Automaker Stellantis says CEO will retire in 2026
- Musk's promised robotaxi unveil delayed
- On US coast, wind power foes embrace 'Save the Whales' argument
- At least 10 dead in Florida after Hurricane Milton spawns tornadoes
- Internet Archive reels from 'catastrophic' cyberattack, data breach
- Wall Street stocks retreat from records on US inflation data
- Israel strikes central Beirut, killing 22
- Solar storm could impact US hurricane recovery efforts: agency
- Delta eyes Election Day travel pullback as profits climb
- Florida battered by hurricane, floods but spared 'worst-case scenario'
- UK's William and Kate in first joint public engagement since cancer treatment
- Over 200 women in legal talks with Harrods over Fayed abuse claims
- A very stiff breeze: BBC says sorry for 20,000 kph wind forecast
- Musk finally unveiling his long-promised robotaxi
- London's Frieze art fair goes potty for ceramics
- US, Europe stocks fall on US inflation data
- US consumer inflation eases to 2.4% in September
- Hurricane Milton tornadoes kill four in Florida amid rescue efforts
- South Korea's Han Kang wins literature Nobel
- Ikea posts fall in annual sales after lowering prices
- Stock markets diverge, oil gains after China rebounds
Tariffs, tax cuts, energy: What is in Trump's economic plan?
Republican presidential candidate Donald Trump wants to bring back US manufacturing and lower costs, relying on tariffs to boost US coffers and exert pressure on other countries -- but the reality is less straightforward.
Ahead of November's election, economists warn his policies could raise consumer prices and shake up global trade -- with unclear benefits to US production.
The pitch is for tariffs to add billions in revenue and take aim at countries like China which have been "ripping us off," while pushing businesses to bring production back on US shores.
"Other countries are going to finally, after 75 years, pay us back for all that we've done for the world," Trump said in his September debate with Democratic nominee Kamala Harris.
He told a rally in Michigan last week: "Tariffs, to me, are the most beautiful word."
The former president has vowed a 10 percent to 20 percent across-the-board tariff on imports and a 60 percent rate on Chinese goods -- more recently threatening a 200 percent levy on automobiles made in Mexico.
It is US businesses -- not foreign governments, as Trump often asserts -- that pay import taxes on overseas purchases when there are tariffs on such goods, and they can pass on the higher costs, which could add to inflation.
Alongside his tariff plans, Trump wants to extend expiring tax cuts and lower corporate income tax further.
But proposed tariffs could counteract the benefits from his tax policy "while falling short of offsetting the tax revenue losses," said the Tax Foundation think tank.
- Higher costs -
US inflation could rise 1.3 percentage points above baseline next year if Trump imposed a 10 percent universal tariff and other governments retaliate, said the Peterson Institute for International Economics (PIIE).
Sharp hikes on Chinese goods would also fuel inflation, the institute added.
Others, like Bernard Yaros of Oxford Economics, estimates a Trump presidency could raise inflation by 0.6 percentage points at its peak.
Previously, businesses bore the brunt as imported components got more expensive, said Kyle Handley, professor at UC San Diego.
But he noted: "If they do an across-the-board tariff of 10 percent to 20 percent, there's no way we're not going to see that on store shelves."
And it is unlikely that manufacturing can return to the United States in short order.
"We haven't made TVs in the US in decades," Handley said, adding that US factories are not producing at the scale needed to satisfy consumption either.
Trump claims earlier tariff hikes on China and others brought no inflation.
But Handley estimates the supply chain frictions exporters faced were equivalent to a two to four percent tariff hit -- and companies tell AFP they have had to pass on some costs.
A 2019 paper in the Journal of Economic Perspectives found that by end-2018, import tariffs were costing US consumers and importers an additional $3.2 billion per month in added tax costs.
- Rerouting trade -
Trump's tariff plans could also slash bilateral US-China trade by 70 percent, redirecting or eliminating hundreds of billions of dollars' worth of exchanges, said Oxford Economics.
US trade volumes could be cut by 10 percent, becoming more centered on North American and other free trade agreement partners, the advisory firm added.
While the added tariffs would raise some $500 billion in revenue annually, rerouted trade from China could slash this figure closer to $200 billion per year eventually, Yaros said.
Other proposals like revoking a status that shields China from various US levies -- "permanent normal trade relations" -- could also raise inflation by 0.4 percentage points in 2025, PIIE added.
Although Trump wants a "reciprocal trade act" where "countries that make us pay a tax to do business with them will be charged the same tax when they send their product into the United States," Yaros believes this is less likely as it requires bipartisan Congressional support.
- Food, energy -
Trump regularly promises to eliminate inflation, too -- a critical voter concern -- saying he would slash energy bills in half within a year.
Analysts expect that this refers to more deregulation in the domestic oil and gas sector.
But Yaros expressed skepticism that this would "unleash significantly greater production" given that it depends on major energy producers, who in turn have shareholders to answer to.
While Trump wants to lower food costs by allowing less foreign agricultural products into the country, economists have noted that import barriers could trigger retaliation.
This could harm US farmers who export significantly.
D.Goldberg--CPN