Tariff Pass-Through Calculator

This calculator turns an import tariff into an estimated price increase for the buyer. Enter the import value, the tariff rate, the share of the duty you expect to be passed on, and any retail markup. It shows the duty, the part absorbed along the supply chain, and the estimated price increase in dollars and as a percent of the product's value. It is for informational purposes only. The result is a scenario estimate, not a forecast.

For what the research says about how fast and how far tariffs reach shelf prices, read will tariffs raise consumer prices.

Inputs and how the math works

The calculator then computes:

• Duty amount = value × tariff rate
• Passed to buyer (pre-markup) = duty × pass-through
• Absorbed by supply chain = duty − passed amount
• Estimated consumer price increase = passed amount × (1 + markup)
• Increase as % of product value = price increase ÷ value

Worked example with the defaults

• Duty: $100 × 10% = $10.00
• Passed to buyer: $10.00 × 55% = $5.50
• Absorbed by supply chain: $10.00 − $5.50 = $4.50
• Price increase with 0% markup: $5.50, which is 5.5% of the $100 import value

If that product sells for $250 at retail, the $5.50 increase is $5.50 ÷ $250 = 2.2% of the shelf price. The percentage the calculator shows is relative to the import value, so convert it if you need the shelf-price percentage.

Choosing a pass-through percentage

The default of 55% is a planning midpoint, not a measured constant. Choose your assumption based on your market and time horizon, and anchor it to the evidence:

The studies measure different things: border prices, retail scanner prices, and price indexes. They don't conflict so much as describe different points in the chain and different time windows. Pass-through tends to rise over time as inventory bought before a tariff runs out and contracts reset.

How markup changes the answer

Many retailers price as a percentage of cost. If a store marks up cost by 100% (a "keystone" markup), each dollar of duty it passes on becomes two dollars on the shelf. The markup field captures that.

Scenario grid for a $100 import at a 12.5% tariff, so $12.50 of duty, showing the price increase per unit:

The 12.5% rate is the Section 301 duty in effect since July 24, 2026 on goods from China, Vietnam, and most other covered economies. At full pass-through with a keystone markup, the shelf price rises by twice the duty, $25 on a product that cost $100 to import. In competitive categories, sellers often add duty in dollars, with no markup on it, to avoid that amplification.

Which tariff rate to enter

Enter the combined ad valorem rate on the product:

1. The General rate from the Harmonized Tariff Schedule for the product's HTS line.
2. Plus any additional duties: Section 232 on metals, autos, and certain wood products; Section 301 on Chinese goods from 2018–2019 and on 60 economies from July 2026.

If you only know the product category, the category tariff calculator gives a trade-weighted default for the additional layer. If you know the code, use the HTS-8 tariff lookup.

To measure the effect of one tariff change rather than all duty, enter only the change. For a product moving from the 10% Section 122 surcharge to the 12.5% Section 301 duty, enter 2.5%.

Three ways to use the result

For a household budget. Run your main import-heavy purchases through the calculator, or use the household tariff basket calculator, which applies one pass-through assumption across eight spending categories at once.

For a seller setting prices. Compare the passed-through amount with your margin. If you plan to absorb the rest, the "absorbed" line is roughly what comes out of your gross profit per unit, unless your supplier shares it. Model the margin effect in the importer landed cost calculator.

For explaining a price change to customers. Show the duty, the share passed on, and any markup separately. A customer who sees "$12.50 duty, $6.88 passed on" understands the increase better than one who sees only a new price.

Worked example: an imported $60 lamp

A home-goods store imports an LED table lamp with a ceramic base for $24, the customs value, and sells it for $60. Its HTS line, 9405.21.80, carries a 3.9% General rate, and the origin is in the 12.5% Section 301 group, for a combined 16.4%.

• Duty: $24 × 16.4% = $3.94
• At 55% pass-through with no markup: $3.94 × 0.55 = $2.17, a price of about $62.17, up 3.6%
• At 100% pass-through with the store's 150% markup on cost: $3.94 × 2.5 = $9.84 (rounded from exact duty), a price of about $69.84, up 16.4%

Same tariff, a 3.6% or 16.4% increase depending on pricing behavior. That spread is why it pays to run more than one scenario.

Common mistakes when modeling pass-through

• Entering the retail price as the product value. Duty is charged on the import value. Using the shelf price inflates the duty by the full retail markup.
• Double-counting markup. If your pass-through share already reflects observed shelf-price changes, as in the Fed retail studies, leave the markup at 0%. Those estimates already include whatever markup behavior stores used.
• Using one rate for every origin. Since July 24, 2026, the Section 301 duty is 10% for 17 economies and 12.5% for most others, and USMCA duty-free goods from Canada and Mexico are exempt. Section 232 goods don't pay it at all.
• Assuming the increase reverses when a tariff ends. When IEEPA tariffs ended in February 2026, replacement duties took effect the same week, and refunds went to importers rather than to buyers. Model a removal as its own scenario rather than assuming prices fall back.

Using the calculator in B2B price negotiations

Suppliers and customers increasingly write tariff clauses into contracts. The calculator helps you put numbers on the options:

1. Full pass-through clause. The buyer pays 100% of any new duty, at cost. Set pass-through to 100% and markup to 0%. The result is the per-unit surcharge.
2. Shared-cost clause. The parties split new duty, for example 50/50. Set pass-through to the buyer's share.
3. Threshold clause. Price adjusts only if the duty change exceeds a set number of points. Enter only the change above the threshold as the tariff rate.

Keep a record of the rate, the date, and the legal authority for each adjustment, such as Section 232 or Section 301. If a tariff is later struck down and refunded to the importer of record, a clear record shows which surcharges relate to the refunded duty.

Limits of the model

The calculator treats pass-through as a single share applied once. In reality:

• Pass-through changes over time and is usually lower in the first months.
• Foreign exporters may cut prices, which lowers both the customs value and the duty. The calculator puts that effect in the "absorbed" share.
• Domestic competitors may raise prices too, which affects what you pay for goods that were never imported.
• Exchange-rate moves can offset or amplify a tariff.
• Sales tax is charged on the final price in most states, so a shopper's out-of-pocket increase is the calculator's result plus the local sales tax rate on that amount. A $10.00 increase in a state charging 7% costs the buyer $10.70.

For the legal side, meaning who owes the duty and who gets refunds, read who pays import tariffs.