Each extra percentage point on average tariff rates pushed consumer goods prices up by around a quarter of a percent over the following year. That is the finding of New York Fed economists Mary Amiti and Sebastian Heise and Columbia University’s David E. Weinstein, whose paper covers 67 categories of non-oil consumer goods and leaves services out. Quartz reported on it in October 2026.
The tariff, on paper, is a duty on imports, and the importer writes the check at the border. The study traces what happens next.
Three channels to the shelf
By the researchers’ count, tariffs had lifted the consumer goods price level 2.9% as of February 2026. Without them, prices would have dipped modestly. About two-thirds of that increase came straight from the higher cost of imported goods. The other third arrived by two indirect routes: domestic manufacturers paid more for imported inputs, and some U.S. producers raised their own prices because foreign competition had been blunted.
Timing differs by route. Tariffs reach import prices almost at once. Goods made in the United States take nine to twelve months to feel the effect as it works through supply chains. The full hit on consumer prices takes roughly a year to land.
What the numbers looked like
The tariff effect on the consumer goods price level peaked near 3% in February 2026 and fell to around 2% by August. The drop followed a Supreme Court decision that struck down tariffs imposed under emergency powers, which were then replaced by a lower 10% surcharge on imports. The Tax Foundation says the Court ruled on February 20, 2026, in Learning Resources, Inc. v. Trump.
Prices did not go back to where they started. Even as the inflation contribution fades, the researchers note, the level for consumer goods stays higher than it would have been without the tariffs. They expect tariffs to add slightly to twelve-month goods inflation again by mid-2027, driven by duties on Canadian goods already in place and a planned increase on Canadian automobiles in January 2027.
The household bill
The Tax Foundation, working from its own model, puts the cost per household at about $1,000 on average in 2025, before the Court’s ruling. For 2026 it estimates $820, because the new tariffs have not fully replaced the ones struck down. Its tracker says US tariff policy has changed more than 50 times since January 2025, and that the new tariffs apply to 54 percent of US goods imports in 2026.
The group also measures the burden in rates. The weighted average applied tariff was 1.5 percent in 2022, according to the World Bank. The Tax Foundation estimates the current tariffs lift it to 11.8 percent, and the effective rate, which reflects revenue actually collected, to 7.2 percent for 2026. In 2025 the effective rate reached 7.7 percent, the highest since 1947, as customs collections rose to $264 billion on goods imports of $3.4 trillion.
On the trade deficit, the Tax Foundation is blunt. Tariffs do not change the balance between domestic saving and investment, so they cannot permanently change the trade balance. In 2025 the deficit fell by just $2.1 billion compared with 2024, while the goods deficit grew by $25.5 billion.
Sources
- Trump Tariffs Tracker: Rates, Revenue, and Impact | 2026 Tariffs
- NY Fed: Trump tariffs added 2.9 points to consumer goods inflation
