The PS5 Pro is an expensive machine at $699. Imagine a world where, at $1,100, those consumer electronics prices could soon be a reality. Thanks to President Donald Incoming Trump and his proposed tax plan
Trump wants to be president soon. He believes that taxes “It's the most beautiful word in the dictionary” as one of his first official actions. Trump expected to impose tariffs on imports to the United States and heavy tariffs on goods from China. Most of the electronics that America consumes are made in China. When taxes are charged The price of everything gamers love will increase and More than we initially thought.–
The Consumer Technology Association used its busy week at CES to release the news. New report Trump's tariffs and what he thinks will affect the prices of appliances It's a horrifying study in the worst possible situations. But it still depends on the policy proposals floating around D.C. right now.
A new CTA report provides more insight into what Trump hopes to do. And how might it change the electronic market? There are two proposals floating around DC at the moment. The first is a blanket tariff of 10 percent and an additional flat tariff of 60 percent on all imports from China, which the CTA calls the “10%/70% scenario.” The second is more severe. The ring would be 20% on all imports and an additional 100% on any goods from China. This terrifying world is a “20%/120% scenario.”
The goal is to punish China and incentivize companies. Move production to the United States to avoid high tariff costs. In fact, companies pass the costs on to consumers. Production and supply chains are complex. Everything needed to produce a PS5 Pro couldn't be created overnight. It takes decades of construction and transformation for companies. In moving production out of China, in the meantime, Americans will pay costs to offset the price of hefty tariffs.
There were initial reports that companies such as Microsoft, HP, and Dell were like this. Collect electronic parts and pushing production outside of China in anticipation of President Trump's inauguration. NVIDIA and AMD, which recently announced new GPUs, are rushing to ship as many as possible to the United States. Before Trump takes office on January 20– The RTX 5090 is now a $2,000 graphics card. That price could increase by as much as 40 percentUp to $2,500 if some of Trump's proposed tariffs are suspended.
“The proposal would increase average U.S. import tariffs. for imports from all countries except China from approximately 1% to 21% and for imports from China from 11% to 131%, assuming current trade levels and patterns,” the CTA report says.
This report covers major consumer electronics items. including laptops, game consoles, headphones and smartphones, and runs the numbers on how the two different situations will affect prices. “Proposed tariffs on these 10 products alone would reduce the spending power of American consumers by $90 billion to $143 billion per year,” the report said.
Laptops and video game consoles will be the hardest hit. This is because China is a major supplier for both. And there aren't many other options. “For example, in 2023, China accounted for 87% of US video game console imports, 78% of US smartphone imports, 79% of US laptop and tablet imports. and two-thirds of U.S. monitor imports,” the report said.
During his previous administration Tech lobbyists convince Trump to exempt them from tariffs on electronic goods. It is difficult to know if they will be able to pull off the same success this time. But the news that AMD and NVIDIA are stockpiling GPUs and the fact that major tech companies are already shifting production overseas are scary signs.
For the CTA, this was an action by the US government. To increase income One that will cost consumers a lot of money. “In essence These proposals are a tool for the U.S. government. To capture as much tax revenue from Americans as possible. We've all seen this movie before and know the ending. The proposed tariffs will not create additional employment or production in the United States. In fact The opposite can happen as our productivity declines and jobs may disappear over time. when workers and businesses have access to affordable technology,” CTA CEO Gary Shapiro and CTA Vice President of International Trade Ed Bryztwa said in the report.
Trump spent a lot of taxpayer money during his presidency. and increased the national debt by $8 trillion. He also cut taxes for high earners. Imposing harsh tariffs that would hit gamers hard would be one way for his presidency to increase revenue for himself without passing more stringent tax laws.