Ever since President-elect Donald Trump was declared the winner of the 2024 election, the internet has been a little less concerned with contrast makeup theory and a little more fixated on economic policy. Specifically, the universal tariffs on imported goods Trump has touted as a major agenda for a second term in office.
Trump's proposed tariffs on the campaign trail—between 10 and 20 percent for all imports and up to 60 percent for goods from China—first bubbled up without much fanfare. But in the final days before the election and the immediate aftermath, alarm bells started ringing all across the internet, from panicked fashion obsessives and corner office CEOS to everyday, average citizens. Some people misinterpret tariffs as a tax other countries pay, but they're actually billed to the companies pushing the products. And U.S. consumers buy a lot of products from abroad. So, to foot the potential tariff bill, brands are expected to raise the prices we all pay at the online checkout or IRL cash register. The situation has all the makings for a retail reckoning: on where our clothes are made and what we choose to buy. As one viral tweet by the costume designer Emma Scott went, "Genuinely curious what's going to happen when a society that buys everything from Amazon, Walmart, and Temu realizes what a 60 percent tariff on Chinese goods looks like."
There's a lot more at stake than sticker shock. As fashion journalist Amy Odell wrote in her newsletter, Back Row, "The price hikes would create a cascade of consequences for consumers who buy clothes, which in turn could adversely affect the fashion industry in many ways."
Before the incoming Trump administration finalized a tariff plan, lobbyists and brands were searching for loopholes, and experts were painting a picture of what 2025 tariffs could mean for all our closets. Then, President-elect Trump confirmed in a Truth Social post on Monday, Nov. 25, that 25 percent tariff on goods imported from Mexico and Canada would be implemented his first day in office. He also promised a tariff of at least 10 percent on goods from China—with the potential to raise it higher.
Instead of bringing your Economics 101 textbook out of storage, read on for a breakdown of exactly what tariffs during a second Trump presidency could entail—and how they'll affect your shopping habits.
What are tariffs, again?
This is the first question on everyone's mind. Searches for "tariff" and "Trump's tariff plan" spiked a combined 6,150 percent in the days following the U.S. election, while searches for "who pays tariffs" are up 350 percent.
By the most basic definition, tariffs are government-imposed taxes on imported or exported goods paid by the company moving the products around. Import tariffs on clothing, appliances, technology, and other retail categories are the most common in the United States. They're often implemented to encourage domestic manufacturing and job growth. In fashion, that would mean more products with "Made in the USA" tags.
But few products, whether we're talking trendy sneakers or tote bags, are made from materials sourced, assembled, and shipped from a single location, so import tariffs don't always produce the intended results. Companies often cut internal costs or raise the prices you see at the mall (or online) to pay tariffs immediately to avoid the even higher costs of re-configuring their entire business.
What is Trump's tariff plan?
President-elect Trump made several tariff promises on his trail back to the White House. First, that all goods imported to the United States would be subject to a 10–20 percent tariff. Second, that a 60 percent tariff would be applied to all imports from China. And third, all goods imported from Mexico would be hit with a 25 percent (or greater) tariff. He positioned the policy as a way to raise money for the federal government, as well as a tactic for retaliating against other nations. "Other countries are going to, finally, after 75 years, pay us back for all that we’ve done for the world," President Trump said onstage during his September debate against Kamala Harris.
Exactly when and how potential tariffs will be implemented weren't immediately announced. “The vision is there, but the game plan is not,” a source involved in the incoming Trump administration's economic policies told CNN.
As of Nov. 25, there are more than concepts of a tariff plan. Trump posted on his social media app, Truth Social, that he would impose a 25 percent tariff on imports from Canada and Mexico, plus at least a 10 percent tariff on imports from China, on his first day in office next year. The president-elect framed the decision as retribution for streams of illegal drugs reportedly moving into the United States. Trump also added that tariffs on Chinese imports could increase. A representative for the Chinese embassy in Washington, D.C., responded that "No one will win a trade war or a tariff war."
Okay, so how do those tariffs affect my shopping habits?
There are a lot of exciting spring 2025 trends to look forward to next year, but the barrier to participating in them will get even higher if tariffs go into effect. So will shopping for basic necessities across clothing, furniture, appliances, and more.
A study by the National Retail Federation found that proposed tariffs could decrease Americans' spending power by up to $78 billion each year. The study suggested that costs retailers need to absorb will be too high for them to pay alone, so prices we all see at the store will rise.
Brands whose products are made in China are the most likely to raise their prices, since they'll be hit with the highest proposed tariff (up to 60 percent, if President-elect Trump raises them further). "Since tariffs are essentially a tax collected once merchandise crosses another country's borders,' retailers that import any merchandise from China will be impacted more severely," says Shawn Grain Carter, associate professor of business management at FIT.
"Made in China" covers almost every corner of your closet, from cotton dresses and T-shirts to running shoes and even designer bags. "Since China was accepted into the WTO [World Trade Organization] in 2001, they became the dominant player in fashion manufacturing across most fashion categories in the majority of price points," Professor Grain Carter explains. "According to 'Good On You,' 65 percent of fashion in the world is produced in China."
Prepare for even middle-class fashion and affordable brands to feel more out-of-reach. Professor Grain Carter notes that fast fashion is an extremely price-sensitive category, and "consequently, Zara, H&M, and others will have to determine the best ways to absorb these tariffs."
Of course, fashion can make internal cost cuts to avoid price hikes. However, something else might be sacrificed to save, such as the quality of the fabric, the sheen of the finishes, or even the packaging arriving on your doorstep.
In the long term, prices could stabilize as retailers consider rebuilding their supply chains. "Obviously, sourcing goods in other countries could be less expensive as a result," Professor Carter says. "This would also make manufacturing more competitive among multiple players, which in turn could stabilize retail prices for consumers."
Are Trump's tariffs only going to affect new merchandise?
Not even a used Birkin bag or previously loved Goyard tote is safe from the impacts of tariffs. The U.S. pre-owned luxury market also stands to shift from policies targeting brand-new merchandise—starting with more price increases.
"Prices in the secondary market rise and fall in line with prices in the primary market," says Sarah Davis, founder and president of Fashionphile. "So when brands who import to the U.S. then face tariffs on those goods, they often hike the retail price in line, which means resale prices will also increase. Retail and resale prices are indirectly hitched to each other."
Some luxury resellers acquire their collection of used Lady Diors and Louis Vuitton Neverfulls wholesale from Asia's secondary market, Davis notes. If vintage gems are sourced overseas, they'll be suseptible to even higher prices. "Tariffs on the import of these goods would mean higher acquisition expenses for U.S. resellers, who would be forced to pass that increase along to the customer if they want to maintain their margins," she explains.
If you want a bag in 2025 with a price closer to 2024 rates, consider companies that source directly from their customers or peer-to-peer platforms. These might be exempt from the same headwinds facing the rest of the market. "The fact that the luxury brands may have to significantly raise prices in their own stores and department stores, could funnel even more consumer interest in more affordable channels, like resale," Davis says. "The consumer has already been vocal in their frustration in the increasing prices that we've seen in the luxury sector in the last couple years. Even higher prices and limited availability could lead to a breaking point for some consumers who would seek refuge in softer pricing alternatives in resale."
So...should I shop before Trump's tariffs go into effect?
Whether your wish list is filled with the best designer tote bags and luxury gifts or just the nicest T-shirts Amazon has to offer, the time to hit "Order" is now. There's still uncertainty as to how much more the president-elect will follow through on the tariffs he promised—though decreeing "tariff" the "most beautiful word in the dictionary" sure makes it sound likely. Still, expert insights and statements from Donald Trump's camp indicate new economic policies are on the way, plus a strong chance 2025 will arrive with higher prices or lower product quality (or both).
Editor's note: This post was updated on November 26, 2024, with information about Donald Trump's new tariff plans.
