My Take on Tariffs
Let's review a definition of the word "tariff" since this word has been used mostly only in "History of Economics" courses in the past century.
TARIFF: Tariffs are taxes imposed by one country on goods imported from another country. Tariffs imposed by the US are trade barriers that raise prices, reduce available quantities of goods and services for US businesses and consumers, and create an economic burden on foreign exporters.
[Source: https://taxfoundation.org/taxedu/glossary/tariffs/]
Taxes can either be progressive or regressive. Progressive taxes are a heavier burden on the rich than they are on the poor, and thus help to reduce the income gap in a country. A regressive tax is a heavier burden on the poor and widens the income gap between rich and poor. Tariffs are a regressive tax. It will be harder for a person with a low income to pay the artificially increased prices that tariffs bring.
The table below shows that while tariffs reduce income for all Americans, lower and middle-class Americans experience a larger after-tax income drop than upper-class households.
[Source: https://taxfoundation.org/taxedu/glossary/tariffs/]
Here at Artisan, when tariffs were implemented on April 5, 2025, we asked AI to help us research the history of US tariffs on imported green coffee. We learned that the last time the US charged duties on coffee was during the Civil War in the 1860s.
Table source: Gemini AI report on the topic "History of US Tariffs on Coffee."
The absurdity of using tariffs as a tool in modern trade policy is, of course, in-line with all the other economics-of-chaos that the current administration in Washington DC has shown as it's trademark. There is no fact-based reason to use tariffs for anything and even less logic to use them on coffee, but none of that makes a difference. Tariffs are here.
Along with high prices from the C Market reaching $4.00 and above, and kind of staying there (the C is at $3.75 as of this writing), all roasters are being forced to raise prices. Retail markets are slowly adjusting. Consumers will absorb some of it, but not all of it. Some consumers will downgrade the quality of coffee they buy. Others will switch to low-cost soft drinks and other sources of caffeine.
We would urge roasters to consider a special message to consumers when they decide to raise prices because of the tariffs. In our humble opinion, raising prices because of the tariffs deserves an educational message when delivered to consumers. A message like,
"Dear Consumer: This increase is to pay the TAX that comes with Uncle Sam's tariffs. Don't like paying more taxes? Tell Uncle Sam."
The reason tariff increases are different than C-market increases is that
consumers are voters. When a price increase is because of the C market, there's nothing a consumer can do about it. When a price increase is because of taxes, there is something consumers can do about it. In fact, according to the
National Coffee Data Trends report, about 66% of Americans will be paying more for their coffee this year. That's a lot of voters.
