Michigan manufacturers brace for tariffs on Mexican imports

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TARIFFS ON MEXICO TO REACH 25 PERCENT BY OCTOBER

A five percent tariff on all goods coming from Mexico will go into effect Monday, with the tariff rising to 25 percent by this fall. This announcement comes as no solution was reached between Mexico’s foreign minister and vice president Mike Pence on how to stem the large influx of Central American immigrants crossing the southwestern border. The impact of the tariffs on state economies will depend directly on the reliance of their major industries on suppliers in Mexico.

According to the US Chamber of Commerce, Michigan is the most dependent on Mexican imports, largely because of cross-border automotive supply chains that send components and finished products back and forth between countries. Michigan imported $56 billion of products from Mexico in 2018, a whopping 10.5% of the state’s total GDP. With tariffs in place, costs will rise both for manufacturers and consumers. It’s now more important than ever to make sure you are using every tax strategy available to you and also making sure you are optimizing your business for efficiency and performance. Contact us in one of our many locations to explore cutting edge tax strategies.

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