Believe it or not? DJI rep says they pay all tariffs.

[EricJT]

It is very simple indeed.

DJI, the Chinese company pays the tariff, and then passes on whatever they want as a cost of doing business.

Why is there such hesitation in acknowledging that some Chinese companies are, in fact, paying tariffs?

Every Chinese company is paying the applicable tariff.....the right question is are they increasing the price to the US consumer or choosing to eat that amount or a part of it?

If I was buying a drone now from DJI, I would compare the price today to the pre-tariff price.

I worked in finance for 35 years and there is no magic to any of this....what has confused the average US consumer is the BS coming out of the the White House.....they would like US consumers to believe the foreign manufacturer is bearing the cost of the tariff and not the US consumer.

 

[Dave Pitman]

Why is there such hesitation in acknowledging that some Chinese companies are, in fact, paying tariffs?

Its because the tariff is paid by the importer. Whether they are an American company, a Chinese owned company, or an individual citizen, it makes no difference. The importer pays the tariff.

You are fixated on when the product is going to be sold through DJI's own store. In that particular case, then they are the importer and pay the tariff and add it (or a portion of it) to the price they list.
But the consumer is ultimately paying the tariff that has been added to the normal cost of the drone.

Let's look at the example of a DJI dealership instead of the DJI store. (It works the same, but maybe it will be more clear this way.)

Let's say DJI charges the dealership $1000 for a drone and the dealership sells it for $1299. Now, with the tariffs in place, the dealership still pays DJI $1000 for the drone. But now they also have to pay the US tariff of $1450 (145%) making the cost of the drone $2450. Then they list it for $2749.
DJI is making the same amount, and the dealer is making the same amount. But the consumer is now paying $1450 more. And that is because they are reimbursing the dealer for the tariff that they paid.

What is likely happening in the case of DJI, both their own store and with dealers, is that DJI is discounting the price of the drone to some degree in order to soften the cost when the tariff is added. They can only do that to some degree. The drones cost something to manufacture and loosing money is not a good business plan.

If you want to say that "DJI is paying the tariff" because they are softening the tariff by discounting the drone, then go ahead. But in the simplest terms, A tariff is a tax placed upon the import of an item, and it is ultimately passed on to the final consumer of that item. Along the way, middle men can choose to pay some of the tariff themselves in order to make a sale. But if any of the tariff is passed on, the consumer is ultimatley paying it if they choose to purchase the product.

 

[Starz]

what has confused the average US consumer is the BS coming out

Which will likely continue for some time. Fortunately for me, simple math has never been difficult.
Another side to this coin is that I can choose to not participate in products that cost more than I care to spend. If someone else wants to impose difficulties on some aspect of my lifestyle, I’ll modify my lifestyle and move on. I tend not to spend time beating a dead horse. I leave that to others that can afford to expend that energy.

 

[mavic3usa]

Which will likely continue for some time. Fortunately for me, simple math has never been difficult.
Another side to this coin is that I can choose to not participate in products that cost more than I care to spend. If someone else wants to impose difficulties on some aspect of my lifestyle, I’ll modify my lifestyle and move on. I tend not to spend time beating a dead horse. I leave that to others that can afford to expend that energy.

Funny you should mention that because I feel the same about not buying anything....for now.

Speaking of "paying the tariff" if 1000 items arrive from China and hit the US shelves and 0 items are sold to US consumers, who paid the tariffs?

 

[Starz]

who paid the tariffs?

Another simple math equation. The folks that shipped it.

 

[Meta4]

Another simple math equation. The folks that shipped it.

The people that get it put on the ship don't pay tariffs.
It's the folks that import it that pay the tariff.

 

[Dave Pitman]

Speaking of "paying the tariff" if 1000 items arrive from China and hit the US shelves and 0 items are sold to US consumers, who paid the tariffs?

There is a LOT of merchandise that was purchased by retailers that was still in transit that decided to divert it somewhere else, if they had that ability, for the reason that they were not confident that they could sell it when adding the tariff. Since the merchandise didn't hit the US, it can be diverted to Brazil, for example, and they can sell it there instead. The guy who runs the Los Angeles Port, the largest in the US, expects imports from Asia to be down 30-35% this May year vs year. All dock related business is looking at reduction in work. He said it will take another 3 or 4 weeks for the same slowdown to hit the East coast ports. But real consequences are coming.

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[mavic3usa]

Another simple math equation. The folks that shipped it.

The people that get it put on the ship don't pay tariffs.
It's the folks that import it that pay the tariff.

This is why it is so confusing because we refuse to use the correct terminology. The tariff is paid by the importer of record at the time the goods enter the US. But every situation is variable which means the importer of record could be the shipper at times and at other times, it could be the buyer or the agent's buyer. The time the goods enter the US could be at an airport, on the ship as a container, when the ship arrives on US shores, at a customs warehouses.....it depends.

The point of my question is when asked who pays the tariff and someone is looking for a country, the answer is:
Sometimes and sometimes

When the President says pays the tariffs, he's not wrong because sometimes a Chinese company is the importer of record.
When everybody else says pays the tariffs, we're not wrong because often the importer of record is a domestic company or agent.

When asked who pays the tariff bills, the question means who gets an invoice from government where you have to make a payment to the government to take custody of the goods you already own and you eventually want to sell. It doesn't mean where a non-government entity ultimately send a bill to such as when Amazon add a line-item to your receipt charging you addition funds and labeling it "tariff." That's not a real tariff. If it's not paid to the government, it's not a tariff; call it something else.

If you don't believe me, just google a couple of sample tariffs that have been floating around. They're all over the board. I would post some of them here but there are too many and they all have a backstory.

 

[Starz]

the folks that import it

Point of purchase will be a component to that part of the equation.

 

[Meta4]

When the President says pays the tariffs, he's not wrong because sometimes a Chinese company is the importer of record.

He is 100% wrong.
He's been trying to convince the gullible that it's not a tax on US consumers and it's somehow going to make the country rich.
It doesn't matter who gets the bill from Customs to import the goods.
Whether it's directly or indirectly, US consumers are going to be paying the tariffs.

Arguing about trivial details of who the importer doesn't change that fact and is a distraction, adding unnecessary confusion to something that's very simple.

 

[Dave Pitman]

The point of my question is when asked who pays the tariff and someone is looking for a country, the answer is:

If you want to make it dead simple, accurate, and avoid any confusion, just change your question to:

"The point of my question is when asked who ULTIMATELY pays the tariff and someone is looking for a country, the answer is:"

THE END CONSUMER