It’s not just the promotional products industry paying more to import products from China as a result of tariffs.

A new report from the Consumer Technology Association (CTA) says American companies paid an estimated $32 billion in additional tariffs on imported technology products between July 2018 and December 2021 as a result of levies former President Donald Trump imposed on goods made in China. The figure has likely risen to around $40 billion so far through 2022, analysts said.

The Arlington, VA-based trade organization, which represents consumer technology companies, called on President Joe Biden to eliminate the tariffs on tech items and inputs to mitigate inflation and lower costs in the sector.

Biden is currently considering whether to lift at least some of the levies on an estimated $370 billion in China-made products in an effort to tame inflation, which is running at 40-year highs in America. U.S. Treasury Secretary Janet Yellen and China’s Vice-Premier Liu He met earlier in July, signaling to some analysts that a scale-down in tariffs could be coming.

Some top members of Biden’s administration, including U.S. Trade Representative Katherine Tai, favor keeping the tariffs in place. Tai, and others, believe the levies give the U.S. leverage in the difficult mission of trying to get China to play fair in international trade. Trump instituted the tariffs to combat what he and supporters characterized as China’s bad trade practices. 

Since first being implemented on July 13, U.S. companies across industries have paid $145.43 billion in “Section 301” tariffs – those Trump put in place.

The study from the CTA contends that the tariffs have stalled growth in tech production and employment domestically and contributed to higher prices on technology products. Connected devices, routers, cables, computers and accessories were the most affected items, accounting for about one-third of estimated Section 301 tariffs on tech products.

While the tariffs have compelled the U.S. tech sector to reduce reliance on China, the industry hasn’t turned to domestic sources, instead increasing sourcing from nations such as Vietnam, Taiwan, South Korea and Malaysia, the reported asserted.

New data from @CTAtech shows how #tariffs on imports from China hurt the technology industry, U.S. economy, and our ability to innovate. The Biden administration must eliminate these harmful tariffs. Read more: https://t.co/3IxaZt0LGC

— Ed Brzytwa 🇺🇦🇵🇱🇺🇸🕊 (@EdBRZA) July 19, 2022

“It’s clear that the tariffs have not been effective in dealing with China and are instead hurting U.S. businesses and consumers,” said Ed Brzytwa, vice president of international trade, CTA. “With rising prices across all sectors of our economy, removing tariffs would mitigate rampant and harmful inflation and lower costs for Americans.” 

Some analysts say removing the tariffs will do little to nothing to help control the U.S.’s current inflation woes. The think tank Peterson Institute for International Economics has said removing all the Trump-era tariffs on Chinese goods would reduce the Consumer Price Index inflation by 0.26 of a percentage point at most.

Removing the tariffs would “hurt U.S. workers and businesses, increase our already crippling trade deficit with China, and squander Washington’s negotiation leverage with Beijing over intellectual-property theft, threatening American security interests,” Robert Lighthizer, U.S. trade representative under Trump, wrote in a July 18 opinion piece in The Wall Street Journal.

“The administration’s purported justification – that removing these tariffs could slow inflation – is nonsense,” Lighthizer continued. The “tariffs on Mr. Biden’s chopping block had almost no price impact across the economy when they were implemented. Consumer prices decelerated slightly after their implementation. To the degree the cost of the tariffs was passed on to American consumers, rather than paid by Chinese producers through price reduction or currency depreciation, it would have created a one-time price increase and couldn’t be responsible for today’s inflation.”

Nonetheless, promo executives have said that the tariffs have contributed to increases on products in the branded merch industry. Promo executives have told ASI Media that removing or reducing tariffs on imports from China could potentially contribute to price reductions on products in the industry down the line, but that’s far from a given. Suppliers are facing a host of inflationary pressures beyond tariffs, along with cost uncertainties, that could negate any potential benefit from tariff removal.

Meanwhile, nixing or lessening the levies could also compel at least some promo suppliers to increase their sourcing from China, counteracting a trend of recent years that’s seen firms move more production out of that nation due to the tariffs and COVID-related issues. Even with that sourcing change, the majority of promo products sold in North America continue to be manufactured in China.