Tariffs are essentially taxes imposed on imported goods. When a government levies a tariff on imports, it raises the cost of those foreign goods for consumers and businesses within the country. As a result, importers will typically pass on these higher costs to consumers in the form of increased prices.
When tariff rates are applied, the price of imported goods rises not only because of the additional tax burden but also because tariffs can lead to reduced competition in the market. Domestic producers may take advantage of the decreased availability or higher prices of imports to raise their prices as well. Therefore, consumers end up paying more for both imported and, potentially, domestically produced goods.
This phenomenon occurs because tariffs disrupt the balance of supply and demand in the marketplace, ultimately leading to a higher cost of living for consumers who rely on imported goods or products that compete with imports. Hence, the assertion that tariffs typically increase prices of imported goods accurately represents their economic impact.