since President Trump imposed tariffs on China there have been questions about who actually pays them let's clear this up who's paying for the tariffs on Chinese imports tariffs explained in three minutes in early 2018 further than a Trump began imposing tariffs on all Chinese made Goods coming in to the United States in several cases the president has even told rally crowds that China's pain for the tariffs saying on one occasion the fact is China devalued their currency they pour money into their system because of that you're not paying for those tariffs China's paying for those tariffs he often reinforces this in tweets saying that China has been paying tariffs to the USA and that these have no impact on the price you pay for the product since they are mostly worn by China economists have been quick to correct the President on this point often telling him that it's the American consumer you and I the ones actually paying for the tariffs but these viewpoints are often at odds with one another so who's right to know that you first have to understand how tariffs work the cyclopædia Britannica defines tariffs as a tax levied upon goods as they cross national boundaries usually by the government of the importing country so in effect the tariff or much like a sales tax only this sales tax applies exclusively when the product is important think about what happens when you buy something you pay the cost plus the sales tax but that extra five to ten percent that you pay in tax isn't actually going to the seller it's going to your state government that's exactly the way a tariff works except that instead of going to the state it goes to the US Treasury in other words the federal government so in effect when President Trump says were taking tens of billions of dollars in from the tariffs he's writing only the money is coming from you the American buyer not China okay so then what's the point of having a tariff if it's not going to punish the foreign company making the widget the point is actually to change your behavior as a buyer why do you buy from China in the first place because each Chinese made widget cost $100 whereas the ones made in the US cost 120 but what if the tariff on the Chinese widgets made them cost more than those made in the US well you might then opt to buy the American ones instead okay so now who pays the tariff in the end you the buyer not the exporting country but hey it's not all bad least you're contributing to the American economy thank you for your service okay so if you found this information I'll hit that like button if you want to know when the next 3 minute explanation drops hit that subscribe and bell icon let me know down in the comments if you have suggestions about what you'd like me to explain next in less than 3 minutes