The Consumer Technology Association (CTA) announced during CES 2025 that the US consumer technology industry is projected to grow from 3.2% over 2024 to $537 billion in 2025. Updated CTA research also indicates that President-elect Donald Trump’s tariff proposals could impact the US consumer purchasing power of tech, and it’s forecast to cut it to $143 billion.
The CTA also wrote a 32-page report titled “How the Proposed Trump Tariffs Increase Prices for Consumer Technology Products,” outlining that tariffs may lead to a $90 to $143 billion decline in US consumer purchasing power. Laptop and tablet purchases may decline by as much as 68%, gaming console consumption could decline by as much as 58%, and smartphone consumption could decrease by up to 37%.
Whether you’re waiting to buy a new smartphone or need an upgrade, you will want to know how Trump’s tariffs affect you.
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What are tariffs, and what are they used for?
Tariffs are taxes on imports. The world operates on trading global goods. Tariffs are put in place to encourage citizens to buy domestically. However, tariffs can be tricky to maneuver. A leader who imposes high tariffs on other countries might hurt the partnership and its people by weakening trading and consumerism.
Countries have operated on tariffs for years until it fell out of favor after World War II. Now, tariffs are used for protection purposes to help combat unfair trading practices and national security. In theory, citizens spend less on imported goods and more domestically, helping further the country’s economic growth.
Who pays for tariffs, and how does this affect tech?
The importer of the goods typically pays for the tariffs. This can be charged as an import fee set by the border or absorbed by the exporter to leverage lower prices. You might not pay for the tariffs directly, but a company can set retail prices to reflect it. For example, if you buy a smartphone from OnePlus, Samsung, and Apple, these companies may include a higher price for the next flagship to cover the cost of these tariffs. Ultimately, everyone pays for the tariffs, especially the consumers. When Trump enacted tariffs in 2018, prices rose for affected products.
It’s a lot to ask companies to stop purchasing international materials, especially in tech (when many depend on China). It’s likely cheaper to outsource them because of where the main manufacturing occurs. According to the CTA’s 32-page report, in 2023, China accounted for 87% of video game console imports, 78% of smartphone imports, 79% of laptop and tablet imports, and two-thirds of imports of computer monitors in the US. In Figure 1 and Figure 2, you can see the calculated retail cost if Trump goes ahead with his proposed tariffs.
Figure 1: Trump 2.0 tariff proposal of 10%/70% and a breakdown of affected tech products, estimated by the Consumer Technology Association.
Figure 2: Trump 2.0 tariff proposal of 20%/120% and a breakdown of affected tech products, estimated by the Consumer Technology Association.
Imagine paying $400 extra for a new laptop or $200 extra for a new smartphone. In addition to these devices, you should look at increased prices for accessories, monitors, and batteries. This drives down consumer practices. As a result, people may wait for sales, opt for older models, or not purchase anything. When people buy less, it drives down the demand for new smartphones and computers.
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What do Donald Trump’s imposed tariffs mean in 2025?
Tariffs have been circulating since 2018, during Trump’s first presidential term. It was part of his “American First” economic policy. In January 2018, Trump imposed tariffs on solar panels and washing machines of 30% to 50%. Later, in March 2018, he imposed tariffs of 25% on steel and 10% on aluminum from most countries. The tariffs extended to Canada, Mexico, and the European Union in June 2018.
In 2021, the US International Trade Commission discovered tariffs increased prices between 1.7% and 7.1% in the ten most affected sectors, including tech. The tariffs on China were kept and expanded under Biden’s leadership. The new plan is to add a 10% tariff on all imports from all countries and a 60% tariff on all imports from China. That number could shift higher (20% on all imports and 100% on Chinese imports). It’s confirmed that Trump plans to charge an additional 10% on tariffs for Chinese imports and 25% on Canada and Mexico on his first day in office.
The speculated economic impact of Trump’s 2.0 tariffs
Many economists are concerned about Trump’s proposed tariffs. The imposed tariffs could bring harmful effects. Maurice Obstfeld, a former chief economist at the International Monetary Fund, cites car manufacturing as an example of what would happen if these tariffs were enacted.
Car manufacturing depends on a supply chain that is spread across the three countries. If you disrupt that supply chain, you have massive disruptions in the auto market.
Prices could increase, reducing product demand, which could hurt company profits and investment levels. This could lead to retaliatory tariffs from trade partners, putting more strain on the economy. It hurts consumers and discourages choices, thus removing purchasing power. For tariffs to succeed in doing good for the economy, it would require bringing manufacturing back into the country while bringing in more employment opportunities, assuming the government has the infrastructure to support it.
How does Trump plan to enact these tariffs?
According to speculative sources from trade policy experts, Trump may declare a national emergency to have these imposed tariffs go through. A national emergency would legally justify universal tariffs on foreign imports, aligning with Trump’s plans. The president-elect could use the International Economic Emergency Powers Act (IEEPA) to put tariffs in place.
At this time of writing, the move hasn’t been officially confirmed.
What else can happen with imposed tariffs?
The countries that are affected by the tariffs might retaliate. Higher taxes on imported goods might lead to sour relations with other countries, possibly increasing the price of other imports. Tariffs should impact the dollar’s value if everything goes right without pushback. In the ideal, higher import duties should strengthen the dollar.
Preparing for a tariff-heavy future
It’s challenging to know everything about tariffs and their full impact until Trump takes office. Based on research from the CTA, the pricing for consumer tech will likely go up if the imposed tariffs happen. If you’re worried about securing your next upgrade to a powerful laptop, like a Chromebook Plus, consider the opportunity cost of getting it now versus later. Otherwise, be aware of what might change.
