Is it time to talk about tariffs?

[Birdman]

Tariffs on Chinese goods have been on my mind but not a discussion I wanted to bring here until it looked closer to reality. Since it was announced that a 10% across the board tariffs are going to be enacted on Feb 1st, it seems like an appropriate to bring this up. Last time, IIRC, the fireworks industry dodged the Tariffs as they were pulled from the final list of goods. At least for now, it appears firework imports will be tax an additional 10%. When you factor in this additional cost and the other sales taxes being applied on top this could result in the overall cost increasing even more if all of the 10% is passed on to consumers.

My question is, what are the expectations of others? Will most of the tariff be passed onto consumers?

Another 10%+ increase on top of the increases we've seen may get me to my breaking point or at least to the point where I will need to scale back even further. This will make it difficult to justify attempting my low budget show set music and instead just doing a smaller "display" show.

Hopefully we can dodge this again.

[Salutecake]

I hope your right Birdman!

[Salutecake]

So a product that really isn't made in the US except by those companies that are big enough to manufacture for themselves or sell a limited quantity (in 1.3) I don't know of any consumer or 1.4 products made in the US. anyway the importer pays the 10% tax on the imports to the US Customs and Border Protection services, the importer charges me the extra 10% and in turn if I put on a show, I would have to charge my customers an extra 10%. I'm trying to figure out how that hurts China except, possibly in a slight decrease in sales that might occur this year. I do see that 10% being paid 3 times by US companies and citizens that goes back into the US pockets whether it be the feds and or state or local tax. This year you might cut back 10% but by next year most of us will forget about the 10% tariff and go about business the usual way so who is paying the price?

those who buy from Mexico might be looking at a 25% tariff???

[BMoore]

I think the answer is no one knows. I'm finalizing my orders for this year just in case. Apparently some prices have actually dropped this year with better pricing being negotiated to move product before the potential tariffs so that may be a small short-term benefit if you want to look on the bright side. Realistically, I would expect the cost of tariffs to be partially absorbed by China and partially absorbed by the importer with another portion passed down to the customer. Hard to say what that cost increase would end up looking like. Hopefully it just doesn't happen.

[Birdman]

Thanks for the feedback. The 10% is significant enough. But with the price of the product going up that means I need to pay more in tax too. Here in PA that's a total of 18% levied on product costing me 10% more. That equates to about a 12% total increase after taxes if my math is correct. That's significant but not a killer. I'm just not sure how much more I can bare though. Especially when I factor in paying more a lot of other things. I'll just have to wait to see how things play out.

[Salutecake]

Hey Birdman did you ever get your 1.4 cert? The only reason I ask is because I believe the 1.4 pro stuff doesn't get the 18% tax.

[Birdman]

Hey Birdman did you ever get your 1.4 cert? The only reason I ask is because I believe the 1.4 pro stuff doesn't get the 18% tax.

Not something I'm really all that interested in unless I would ever join a club and start going to shoots. 1.4 just isn't practical in my situation. But that does raise a good point. I believe I am not charged the 12% fireworks tax on my Pro product. I still use a good amount of consumer product but it does help with my initial calculations.

[Fire Art]

Correct, 1.4 pro items should not be assessed the 12% extortion tax as they are not consumer items.

[Salutecake]

So did fireworks make the tarriff list?

[PyroFL]

It’s official, all fireworks loaded for shipping from China starting February 1 will be subject to this tariff.

It’s a blanket tariff with no exceptions or exclusions.

[displayfireworks1]

The National Fireworks Association sent this link out to the members. I did not get a chance to read it yet.
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https://www.whitehouse.gov/fact-sheets/2025/02/fact-sheet-president-donald-j-trump-imposes-tariffs-on-imports-from-canada-mexico-and-china/
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Maybe its just me on this. I am watching the fluctuations in the value of the stock price on Walmart as a meter of the impact of these tariffs.
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https://finance.yahoo.com/quote/WMT/
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On a side note: Who is old enough to remember a tariff on imported motorcycles larger than 750 cc back in the 80's and the positive effects it had.

[PyroFL]

I remember the tariff was to help Harley Davison to improve their sales but not to much for then that. Remember Family members being happy about it.

At the time I was riding my BMX from Sears so didn’t effect me that much.

[displayfireworks1]

The motorcycle tariff dropped the price of a 1985 Honda 1100 cc motorcycle I wanted to purchase. Because of the tariff, Honda started building motorcycles in Marysville Ohio. The year was 1985. The price of the Honda V65 Magna dropped from $4500 to $4042 dollars. Harley recovered and did well for years because of that tariff from the President Regan.
Between this price dropping and this commercial. Here is the motorcycle I purchased and owned for around 16 years. Always loved that commercial that made me buy the bike. Pulled over too many times on that bike. Best I ever got on it was a 12.2 on the quarter mile. Was purported to do 11.4 I moved back to on/off road bikes after that one. Although I am tempted to get a ZX14. LOL
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https://www.youtube.com/watch?v=bwKidzsORY8
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The rider on the bike is Jay Gleason. He was the go to 1/4 mile guy at the time.

[Salutecake]

Well, so after 40 years of using tarriffis to protect Harley it is still facing financial troubles and Honda is doing well. So really what is the effect? I'm not saying that tarriffs don't work but they have to be used the right way.
Reality is that tarriff did not drop the price of the motocycle, it was the building of it here in the us that lowered the price, if Honda nevered decided to put a plant here you would have either had to pay that extra tarriff tax or move on to something else.
Americans want cheap shit, be we can't compete with cheap labor and no environmetal concerns.
There are a lot of arguements for an against tarriffs, but I don't think this is the forum to engage such theories. But it's your forum.
I do know that a 10% tarriff on fireworks coming from China is going to be paid, not by the Chinese but the importer that picks it up and then most of tthe tarriff if not all will be passed on to me. It will be a hot topic now but by next year if it is still on, most people will have forgotten and spend what they think is appropreate.

[displayfireworks1]

I heard that is true , the tariff is paid by the importer and will not be China paying. Using the motorcycle tariff from the mid 80’s as an example. I do not see China moving part of their operation to United States to manufacturer Consumer Fireworks like Honda did with larger motorcycles.
Years back there was a fireworks tariff , not sure if it still exist. It was a tariff on sparklers. Metal wire sparklers to be specific. This was to protect the last remaining sparkler manufacturer in United States. Now owned by Phantom Fireworks. That is probably why you now see all these wooden stick sparklers, to avoid the tariff. I actually have a video about it.

[Blaster]

Yea, what manufacturing business is there here in the US that needs the protection from China?

I mean, in what state will we allow 12yr olds to work 10hr days for $35/wk handling explosives' ??? ;)

[BMoore]

With any luck this tariff will be removed. It will be levied on goods at U.S. customs on departures from February 1 forward so it will be a few weeks before shipments are affected.

Also, not to trivialize this, but the 10% is on the value of the import which. It is not on the mark-up, shipping and other fees that determine the cost to the end purchaser. Realistically, once passed to the consumer you are probably looking at about a 4% or 5% increase.

[Salutecake]

While I understand what you are trying to say - no matter what other charges you are talking about - if you purchased a shell at a dollar it gets taxed at 10% -- shipping and other fees are already calculated and applied at the time of purchase - when the importer comes to pick up his product, the importer will have to pay an additional 10% at customs - now how much of that 10% is going to be passed on to us? You're saying the importer will pick up 6 or 7 % I don't think so.
My point - a thousand shells at a buck a piece equals a 1000 bucks shipping and handling 300 bucks 10% on the product equals 100 bucks shipping and handling still 300 bucks who's paying that extra 100 bucks?

[BMoore]

While I understand what you are trying to say - no matter what other charges you are talking about - if you purchased a shell at a dollar it gets taxed at 10% -- shipping and other fees are already calculated and applied at the time of purchase - when the importer comes to pick up his product, the importer will have to pay an additional 10% at customs - now how much of that 10% is going to be passed on to us? You're saying the importer will pick up 6 or 7 % I don't think so.
My point - a thousand shells at a buck a piece equals a 1000 bucks shipping and handling 300 bucks 10% on the product equals 100 bucks shipping and handling still 300 bucks who's paying that extra 100 bucks?

The tariff is on the value of the import, not the end cost to the consumer. Using round numbers, let's say an importer, purchases from China 1,000 shells at a buck a piece, the value at import is $1,000 so the tariff is $100. Once imported, the importer/distributor is going to mark up the cost of the shells to let's say $2,000 plus the cost of shipping (We'll just say another $100). So now, the cost to you the consumer is $2,100. Now add in the full tariff at $100 and that becomes only 4.76% tacked on to you the consumer.

[Icooclast]

in case no one heard from 76 fireworks, here is the update they sent me in my email.

Here’s What You Need to Know
The current administration has implemented higher tariffs on goods imported from China, including fireworks. We are closely monitoring the situation and want to provide you with the latest information so you can plan accordingly.
What This Means for You

No Immediate Changes to Pricing – Our current pricing will remain in place through February 28th.
March Outlook – Due to these tariff changes, we will be adjusting pricing starting March 1st by up to 10%. We are actively evaluating the situation and will provide an update as soon as possible. We encourage you to place orders before February 28th to secure current pricing.
Dropship & Tariffs – The 10% tariff will apply as an additional line item customs fee on any dropship containers that meet the parameters of the Executive Order. Accordingly, if your dropship container ships after February 4th, the 10% tariff will result in your container expenses increasing.

European Tariffs
Please note, our European products, including 76 Pro Line Italia, Pyrolamas, iShot, and Europla Smoke Mines are not impacted by these tariffs. The current administration is considering tariffs on European products in the future. We will monitor the situation and communicate any impacts on those items as needed.
Other Updates & Reminders

Special Order Program Extended – We’re keeping this program open through February 28th, allowing you more time to take advantage of early-buy opportunities.
Shipping Discount Available – Save on freight with our ongoing shipping promotions. See our website for the latest deals.

We’ll keep you updated as we learn more. If you have any questions, please don’t hesitate to reach out.

[Icooclast]

oh, and dave, that tariff thing with motor cycles. it was the year before i was born. (86) but any way, it could be worse: the tariff could be much higher.

[Salutecake]

I'm sorry BMoore, your only diluting the final percentage so let's make it 3000 or 4000 markup, and that takes the increase down and down again - it's still going to add 100 bucks to the intial cost -- 3100, 4100 you can dilute it all the way down so no tarriff shows up in the final figure, but that 100 bucks is still there and the importer is paying it.

[BMoore]

I'm sorry BMoore, your only diluting the final percentage so let's make it 3000 or 4000 markup, and that takes the increase down and down again - it's still going to add 100 bucks to the intial cost -- 3100, 4100 you can dilute it all the way down so no tarriff shows up in the final figure, but that 100 bucks is still there and the importer is paying it.

Correct. The $100 is still there and that will get passed on to us. I don’t disagree. However, my point is that if you normally spend say $5,000 on fireworks, you aren’t going to see a 10% ($500) price hike. I would expect closer to 4 - 5% on average.

[Salutecake]

I also agree with you. And I really don't want to carry this on but still a lot of people believe the tarriff is paid by the other country, I really just wanted to keep the point that we pay it not china.

[Birdman]

Yea, what manufacturing business is there here in the US that needs the protection from China?

I mean, in what state will we allow 12yr olds to work 10hr days for $35/wk handling explosives' ??? ;)

This is where I'm at. What fireworks industry are these tariffs trying to protect or do we expect to return to the U.S.? What is the goal here? That's what I'm waiting to find out.

[PyroFL]

This is where I'm at. What fireworks industry are these tariffs trying to protect or do we expect to return to the U.S.? What is the goal here? That's what I'm waiting to find out.

Here is the answer Birdman. The summary is just an overview, but it will get you closer to answering your question. The 2nd link is the full report and the overall strategy.

Executive summary:

https://vinacapital.com/wp-content/uploads/2024/11/20241129-Summary-of-A-Users-guide.pdf


If you’re not familiar with economy matrix and social accounting matrix I would take an hour and read up before digging deeper with the link below.

https://www.hudsonbaycapital.com/documents/FG/hudsonbay/research/638199_A_Users_Guide_to_Restructuring_the_Global_T rading_System.pdf

Need more let me know …

[Salutecake]

Nice articles on how money is moved around on paper, and if this happens that happens and so on. But the article doesn't say who is going to build the factories to make products that Americans can sell to other countries, and how to compete with Chinese manufacturing - I think that's one of those things that looks good on paper but you can't put it to practical use. The papers and numbers get pushed around as yo look good but as far as the common man goes - where is my job. If it's manufacturing - it's going to take years to make or convert buildings into something productive, and then to manufacture what?

The Mar-a-Lago accord doesn't address how to compete with China, and really how can you - China can mine the minerals out of the ground, process the materials, into they want, at a price that will always be cheaper than the US can - so when do the tarriffs end on chineese goods.

The job market is totally different then the money markets. Ai jobs are probably the imdediate future - but they only help an elite few. The might need building and computers but where do the computer parts come from - right not the US andthelist goes on.

This morning I started to read , now trump was to raise tarriffs again that's going to almost double the cost of cars. England buys steel and aluminum from the US now why not buy it from Canada - The EU could take Canada into it's Union and there goes trumps 51st state and at the rate he's tarriffing them I wouldn't blame them. How about Canada bypassing the US and buying it's veggies directly from Mexico or how about just by more from China?

My final thought, is if that with all the tarriff action being thrown out there, I wouldn't be surprised if a country or a bunch of contries grew a set of balls and pushed back against all these tarriffs an just started trading with out the US.

[Salutecake]

Another 10% tariff increase next week for China?? Is that what I'm reading?

[jknepp1954]

another 10% tariff increase next week for china?? Is that what i'm reading?

unfortuneately that is correct

[displayfireworks1]

From the National Fireworks Association
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[Salutecake]

So affter last nights tariffs -- I am reading a 34% tariff increase some are saying that is added to the exicting tariff of 20% making it a 54% total tariff, what'sthe truth?
One artile: "However, with the US imposing even higher tariffs on China (54%), Vietnam (46%)"

[BMoore]

It's been confirmed that the tariffs are stacking so the 34% is on top of the original 20% so we are now looking at 54%. So glad I did most of my purchasing early this year and my distributor is not marking up product already in stock and paid for. I've still got a handful of cases not yet in port, so I'll probably get hit, but not too bad. I'm more worried about 2026....The year where I and everyone else wanted to go big for the 250th.

[Wholesale Fireworks]

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Here is what NFA is saying.