HONOLULU (HawaiiNewsNow) – President Donald Trump’s new global tariffs took effect today, and Hawaii business owners, who’ve been absorbing costs for months, say they have no choice but to raise prices.
The new tariffs range from 10 percent to 50 percent on goods from more than 60 countries and the European Union.
The Trump administration says this will reap billions of dollars in tax revenue, but economists say American consumers face even higher costs on everything from clothes to cars to cheese.
Importers in Hawaii are advising shoppers to buy sooner than later to avoid price hikes and product shortages.
“This is a massive tax increase and right now it’s being shouldered by companies and by the end of the year it be shouldered by the the individual consumer to the tune of anywhere from 15 to 50%,” said Jalene Kanani Bell, owner of Noho Home, which has been manufacturing goods in Waipahu for the past five years.
“We make native Hawaiian inspired luxury home decor, so everything from comforters to duvet covers, sheet sets, those are all 100% comb cotton sateen versus our 100% wool rugs.”
“For the microfactory, we do need to buy our raw materials from elsewhere. We don’t grow cotton, we don’t extrude polyesters, we don’t weave,” Bell said.
Those mainly come from China, India, Pakistan and Australia.
Bell says it’s been a nightmare trying to plan around President Trump’s fluctuating trade policy and constant uncertainty.
“You’ve got things that are on the dock and you kind of decide, well, maybe I’m just going to wait until there’s some normalization,” she explained. “You’re dipping into whatever liquidity you have, you’re taking on additional debt to basically get over the hurdle to wait until this until a moment of normalcy and then understand what you’re gonna do about your prices.”
After months of absorbing higher costs, Bell and other business owners say they’re raising prices and passing some of the tax burden onto customers.
And it’s not just companies that rely on Asian goods, but also companies that rely on importing European goods, like Bocconcino in Kakaako, which imports specialty meats, oils and wine and makes cheese in-house.
Part of the owner’s survival strategy is ordering less inventory.
“We didn’t bring in as much as we did the previous year, so we cut down on the quantities,” said chef-owner Donato Loperfido. “Last year, nine pallettes, this year five. That’s a big difference, almost half.”
Loperfido says Trump’s 15% tax on EU products only exacerbates a bigger, existing problem.
“The shipping costs to Hawaii are outrageous. There is the tariffs are nothing. It’s the shipping costs that are killing us,” he said. “We really need to work on something to lower the prices of the shipping costs and we really need the help from our senators.”
While the new tariffs are meant to support U.S. manufacturing, business owners aren’t sure consumers are willing to pay more for American-made goods.
The true test will come during the busy holiday shopping season.
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