Tariffs proposed by President Donald Trump will have a negative impact on Wisconsin consumers, according to a new report from the University of Wisconsin-Madison’s Center for Research on the Wisconsin economy.
The proposed tariffs on Canada, China and Mexico involve Wisconsin’s top three trading partners involving about half of the state’s imports and exports, according to the report.
Canada announced Wednesday it would put a 25% retaliatory tariff on $20 billion worth of U.S. goods beginning on Thursday.
“With tariff hikes, Wisconsin households and firms face higher prices and production costs related to imports, while the state government does not benefit directly from increased customs duties,” the report says.
The state imports most of its live animals and fertilizers from Canada while nearly all of the state’s exported beverages, spirits and vinegar go to Canada. Tariffs against the countries make it likely that those countries will begin retaliatory tariffs, the report states.
“The burden of tariff hikes has fallen almost entirely on domestic consumers and importers, with little effect on prices charged by foreign exporters,” the report said, basing the conclusion on evidence from Trump’s first term.
The tariffs led to $34.3 billion in customs duties to the federal government while the resulting losses to U.S. consumers and firms that buy imports were larger at $51 billion with an aggregate loss of $7.2 billion.
“The import and retaliatory tariffs caused large declines in both U.S. imports and exports, substantial increases in the prices of intermediates and final goods, and dramatic changes in the supply chain,” the report said.
Wisconsin imports more now than before with $38.9 billion in imports in 2024 compared to $27.7 billion in 2017, meaning there could be a larger impact on Wisconsin consumers.
Some of the largest categories of products imported to Wisconsin are nuclear reactors, boilers, machinery, electronics, pharmaceuticals, vehicles, optic and photo devices, medical equipment, plastics, furnishings and more.
