Economist says consumers will pay more due to Trump's tariff proposals.

"After 75 years, we will finally receive payment from other countries for our contributions to the world," he stated.

The Biden administration maintained Trump-era tariffs, but Harris described Trump's new plan as a "20% sales tax on essential goods needed for daily life."

According to Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center, if President Trump increases tariffs on imported goods, it is certain that American consumers will have to pay more.

Here's what the proposed policy means for your money.

What tariffs mean for your money

A tariff is a tax on imports, which is paid by the importing country, not the exporting country, as Trump often claims. For instance, if a U.S. company wants to import goods from China, they must pay more to bring them in.

Although tariffs haven't been a significant source of revenue for the U.S. government for over 70 years, they are still used to generate income.

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The imposition of tariffs results in companies passing on the additional cost to consumers.

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The exact increase in prices is difficult to determine, and it is not a straightforward linear relationship as Harris' "20% sales tax" portrays it to be, according to Clark Bellin, the chief investment officer at Bellwether Wealth.

He says that it's challenging to determine the exact impact of tariffs on prices when inflation is also taken into account.

Numerous organizations contend that Trump's fresh tariff policy will adversely influence American consumers' financial well-being.

According to Sam Millette, director of fixed income at Commonwealth Financial Network, when a country imposes new tariffs, other countries affected by the move typically respond.

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