U.S. President Donald Trump has announced the implementation of a 100% import duty on pharmaceutical drugs and 25-50% tax on furniture, kitchen cabinets, and heavy trucks, effective October 1, 2025. His objective is to promote domestic industries, but there is a risk that this could increase inflation and financial pressure on consumers.
New Import Duty: U.S. President Donald Trump announced the implementation of a 100% import duty on pharmaceutical drugs and 25-50% on kitchen-bathroom cabinets, furniture, and heavy trucks, effective October 1, 2025. Trump states that this move will boost domestic manufacturing and reduce the budget deficit. However, economic experts are warning that it could lead to increased inflation and a heavier financial burden on consumers. Companies engaged in domestic manufacturing will be exempt from this duty.
Purpose of the Tariffs
Trump stated on his social media platform, “Truth Social,” that this step is aimed at promoting domestic industries and making the American economy self-reliant. He believes that this policy will strengthen manufacturing in the U.S. and reduce the government's budget deficit. He also added that encouraging domestic producers is the primary goal of this policy.
Impact on Drug Prices
Experts believe that a 100 percent import duty on pharmaceutical drugs could directly impact the pockets of ordinary consumers. The U.S. imported approximately $233 billion worth of drugs and medical products in 2024. If this duty is implemented, drug prices could double, increasing the financial burden on Medicare, Medicaid, and general consumers. Trump stated that this duty will not apply to pharmaceutical companies that are establishing manufacturing units in the U.S.
Stricter Measures on Furniture and Cabinets Too
Trump has also announced a 50 percent duty on the import of furniture and kitchen-bathroom cabinets. He claims that foreign manufacturers are flooding the American market with these products, harming local industries. This could increase the cost of home construction and renovation. The U.S. is already grappling with a housing crisis and high mortgage rates. In such a scenario, this tariff will directly impact the pockets of ordinary citizens.
25 Percent Tax on Heavy Trucks
Trump stated that foreign truck manufacturers are harming American companies. He explained that companies like Peterbilt, Kenworth, Freightliner, and Mack Trucks will be protected from foreign interference. He believes this step will incentivize American companies to invest and manufacture domestically.
Questions on Inflation
Economic experts have warned that such high import duties could increase inflation and impact economic growth rates. Federal Reserve Chairman Jerome Powell has stated that rising commodity prices directly fuel inflation, and import duties could be a primary cause of this.
What the Data Shows
According to the Consumer Price Index (CPI), the inflation rate has been 2.9 percent over the last 12 months. In April, it was 2.3 percent, the same month when Trump made his first major announcement regarding import duties. Furthermore, despite the tariffs, a decline in jobs has been recorded in the manufacturing and construction sectors. Since April, 42,000 jobs in the manufacturing sector and 8,000 jobs in the construction sector have been lost.
