What is the true cost of tariffs? It’s debatable — not only because of political biases, but also because it’s far from straightforward to calculate just how much of the levies consumers end up paying.Even so, it’s possible to estimate how much the price of common items could increase under President Donald Trump’s various tariff proposals. For products like clothing imported from China and Vietnam, U.S. shoppers could have to pay a lot more.To illustrate, retail consultancy group AlixPartners created pricing models exclusively for CNBC, looking at the price of a men’s sweater and men’s shoes made in both China and Vietnam before and after Trump’s April 2 “reciprocal” tariff announcement. The estimate assumes the retailer is maintaining its previous profitability levels, and using no cost mitigation strategies but rather passing along the tariffs to shoppers in the form of higher prices.Under a current 30% tariff, the price of a men’s cotton sweater and a pair of men’s shoes made in China would both rise about 19%, according to AlixPartners. If Trump implemented the currently suspended 145% tariff on imports from China, the price of those same sweaters or shoes would spike roughly 90%.Using a current 10% tariff on goods from Vietnam, the price of a sweater and shoes would both rise about 8%. But under the now paused 46% levy Trump previously proposed, the price of those items would rise roughly 35% each.The models won’t capture exactly how tariffs will affect consumers. Still, they underscore that the levies, even at their current levels, could take a major toll on U.S. households.Shoppers may not see price hikes that large for multiple reasons. Most large retailers are using various strategies to offset as much of the cost of the tariffs as possible: Target CEO Brian Cornell, for instance, told reporters raising prices would be the company’s last option. Final tariff rates could also end up lower than those used in the models.Retailers usually don’t want to raise prices, because it dampens demand. But they also have a fiduciary duty to shareholders to remain profitable. At the tariff levels Trump announced on April 2 on about 60 U.S. …
