The Real Cost of Ordering from Overseas

Sonia Vich

(CMA CGM QUARTZ container ship. Image via Rawpixel, CC0 Public Domain.) 

A cheap international order does not always stay cheap. A shirt, a phone case, a pair of shoes, or another everyday item may look affordable online, but trade policy can change what that purchase ultimately costs. The price displayed online does not always reflect what an item will ultimately cost once it enters the United States. For years, many low-value packages entered the United States without duties under the de minimis exemption. This changed on August 29, 2025, when the United States ⁠suspended duty-free de minimis treatment for shipments valued at $800 or less from all countries. 

That change raises a larger question: Who really pays when tariffs make imported goods more expensive? While tariffs can support American industries, their benefits must be weighed against the costs they create. Although tariffs are collected when goods enter the country, foreign businesses do not necessarily bear the full cost. Importers may absorb the added expense, negotiate with suppliers, or pass part of it along through increased prices. Recent Federal Reserve research ⁠shows that tariffs implemented in 2025 led to significant price increases for consumer goods with greater exposure to tariffs.   

The end of the de minimis exemption makes this issue especially relevant to international online shopping. U.S. Customs and Border Protection ⁠states that imported goods valued at $800 or less are now subject to applicable duties, taxes, and fees rather than automatically receiving the previous duty-free treatment. A policy that may seem distant from everyday life can now affect something as simple as ordering an inexpensive product from an international seller. 

The numbers show how quickly these costs can make their way to shoppers. Federal Reserve researchers ⁠estimate that tariffs implemented through November 2025 raised core goods prices by 3.1 percent through February 2026 and added 0.8 percent to overall core personal consumption expenditures prices. Their analysis also indicates that if tariffs raise a retailer’s cost of acquiring a product by $1, the retailer charges about $1 more for that product seven months later. A dollar may not seem like much on a single purchase, but small price increases can quickly add up across everyday expenses. 

This pattern is not new. After the 2018 tariffs on washing machines took effect, washer prices ⁠increased by nearly 12 percent. Dryer prices rose by a similar amount even though dryers were not directly subject to the tariffs, demonstrating that the effects can spread beyond the specific product being targeted. Changes in one part of a market can influence the prices consumers encounter elsewhere. 

The consequences also extend beyond what appears on a price tag. Research examining household transactions after the 2025 tariffs ⁠indicates that lower-income households carried a disproportionate share of the burden as tariff costs passed through to retail prices. Spending on affected goods fell about three times as much as prices rose, with households cutting back primarily on nonessential purchases. Shoppers do not always respond by simply paying the difference; sometimes, they decide the purchase is no longer worth making. 

Still, tariffs are not imposed simply to make foreign products more expensive. Supporters maintain that making imports less competitive can give domestic producers more room to grow, encourage companies to manufacture goods in the United States, and reduce reliance on foreign supply chains. Those goals matter. If a tariff creates lasting investment and employment in American manufacturing, some additional costs may come with broader economic benefits. 

The difficult part is determining whether those benefits outweigh what households give up in return. A 2025 National Bureau of Economic Research working paper ⁠suggests that tariffs can increase overall manufacturing employment in the long run under its economic model, while employment is likely to decline in the short run as supply chains adjust. In the short run, however, employment may decline as businesses adjust their supply chains and respond to higher costs. This means that the benefits tariffs are intended to create may take time to appear, while workers and consumers can feel the effects of those changes much sooner. 

The same analysis also points to more movement of workers between manufacturing sectors than overall employment growth. That distinction matters. A tariff may change where people work without producing the broad increase in American manufacturing jobs that consumers might expect in exchange for higher prices. The economic picture is therefore more complicated than placing a tariff on foreign goods and watching American factories immediately expand.  A more direct approach could focus on investing in American manufacturing in ways that help domestic businesses expand and create jobs without depending on higher import costs to drive that growth. 

Protecting domestic industries is a legitimate goal, but higher import costs do not automatically lead to stronger American manufacturing. That uncertainty makes the burden placed on consumers harder to justify without clear economic benefits. The real cost of ordering from overseas is no longer just the number displayed next to the “buy” button. It is also part of a larger trade-off between what Americans pay today and what the economy may gain tomorrow. Policymakers should weigh both sides of that trade-off and pursue policies that strengthen American manufacturing without placing unnecessary costs on consumers.