European Union Says US Consumers Will End Up Paying Tariffs

European Union leaders detailed the terms of a trade deal they struck with President Donald Trump on Thursday, making sure to point out who will pay for what in the massive deal.

Since retaking office, Trump has hit nearly every nation with new tariffs and is working to reshape global trade to give American companies homefield advantage. But it could cost U.S. consumers.

“Tariffs are paid by the company importing the imported goods. So, for tariffs imposed by the U.S., it is the American importer who pays,” according to a fact sheet on the deal from the 27-nation bloc. “For example, if a European company exports shoes to the U.S., the U.S. company buying these shoes owe the tariffs to the U.S. government.”

The White House has insisted that foreign nations and businesses will pay the tariffs, not American consumers.

In May, White House press secretary Karoline Leavitt said, “The president is committed to ensuring that prices remain low for American consumers and he maintains the position that foreign countries will absorb these tariffs.”

EU officials disagreed.

“In many cases, the importing company will push to offset some of this cost either by asking for a discount from the supplier or by raising the price for end consumers,” according to the release. “In the end, it is usually the consumers (in this case, U.S. consumers) who will indirectly pay for the tariffs.”

Alex Durante, a senior economist at The Tax Foundation, said that in the past, the cost of import duties was shared by businesses and consumers. However, that might not be the case going forward.