Neil Bradley
Executive Vice President, Chief Policy Officer, and Head of Strategic Advocacy, U.S. Chamber of Commerce
Updated
May 12, 2025
Published
April 15, 2025
Tariffs are having a real and devastating impact on thousands of small businesses across the nation as uncertainty, rising costs, and cancellations are hitting home.
To help thousands of small businesses navigate the challenges, the U.S. Chamber has been answering questions, holding briefings, sharing resources, and lobbying on their behalf. The Chamber sent a letter asking the administration to address the impacts of tariffs by granting automatic exclusions for any small business importer, establishing a process for companies to apply for an exclusion if the company can demonstrate that tariffs pose a risk to employment for American workers, and providing exclusions for all products that cannot be produced in the United States or are not readily available.
“We have heard from a historic number of small businesses who have made it clear: they need immediate relief from tariffs,” said Suzanne P. Clark, President and CEO of the U.S. Chamber of Commerce. “As each day goes by, small businesses are increasingly endangered by higher costs and interrupted supply chains that will cause irreparable harm. We applaud the administration’s efforts to negotiate as many new trade agreements as possible that expand market access for U.S. companies and benefit American workers, but these deals take time, and many businesses simply can’t afford to wait while negotiations proceed.”
MORE: U.S. Chamber to Administration: Small Businesses Need Immediate Relief from Tariffs
What Are Small Businesses Saying?
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Key Things to Know About Tariffs
- A tariff is a tax on imported goods paid by the U.S. business or individual receiving those goods at their port of entry.
- Tariffs are levied on imported goods, not on services.
- Broad-based tariffs bring painful retaliation against American exports, with American workers and farmers likely the first to feel the pain.
Recent Tariffs Impacting Small Businesses
- 10% on nearly all imports, across all countries. For a few hours on April 9, higher tariffs were threatened for about 57 of our largest trading partners, but those were paused for 90 days.
- 25% on steel, aluminum, autos, and many auto parts.
- 30% on Chinese imports, down from 145% after a deal was reached with China on May 12.
- Additional tariffs on products from Canada and Mexico that don’t comply with the USMCA.
Frequently Asked Questions
In a special event held on May 9, U.S. Chamber of Commerce Executive Vice President, Chief Policy Officer, and Head of Strategic Advocacy Neil Bradley and Senior Vice President, Head of International, John Murphy, shared the latest on tariffs and how they are impacting small businesses.
Which tariffs have been paused?
The 90-day pause on the much higher global tariffs that were threatened in early April is set to expire on July 8, 2025. Many are wondering if the administration will put them back into effect, but we don’t have any clear indication if that will happen or not.
There are negotiations underway with a number of countries around the world, and how exactly everything will play out when we get to July is not clear.
All told, these tariffs introduced in the year to date represent the biggest tax increase in more than 50 years.
Which industries or commodities will experience the most significant disruptions due to the tariffs?
Many of America’s most advanced manufacturing industries — including aerospace, medtech, and automotive — depend on global supply chains. Even industries that are largely domestic in production — such as the manufacture of windows or cement — will see heavy new costs, and the prices of domestically-produced goods will rise in parallel with those of tariffed imports. Many small businesses that depend on imported components will feel tariffs cut into already slender margins.
We also expect impact to the nation's Heartland farmers and ranchers—they're already seeing a drop-off on export sales, and they're often one of the first targets of retaliation. It's really the nation's Heartland more than the coasts that are hit first by tariffs.
How do we know if goods imported from Canada or Mexico qualify for duty-free treatment under USMCA?
There are different tests for goods to qualify under USMCA. Some goods are obviously produced in one spot in North America, like lumber from a tree in Oregon. Other products, such as autos, must comply with detailed rules of origin outlined in the agreement. In other cases, a product must undergo a “substantial transformation” that adds value and allows it to be deemed North American. Companies should consult trade counsel or their customs broker for details.
When will we see the impact of tariffs?
The impact has already started, especially for businesses that must pay the new tariffs in real time — and these effects will compound over time. We are already seeing small business importers with duties showing up on invoices for products they purchased from overseas.
Overall, some businesses will feel it immediately. Some will be more protected because of their inventory. Some have greater ability to delay price increases. But every week that goes on, the negative impacts are going to build.
Our products are normally exempt from import duties. Will these products be exempt from the new tariffs?
No, with very few exceptions. At the beginning of the year, about half of all imported goods paid no tariffs, but the administration has granted no exceptions to its sweeping new tariffs to date (except for select products such as semiconductors, pharmaceuticals, and lumber that the administration plans to subject to a different class of tariff in the near future). A rare exception is energy and some minerals.
Do you anticipate any further small business exemptions or reimbursements?
Administration officials have uniformly said there will be no formal process for businesses to seek exemptions. President Trump has at times seemed to hint otherwise, but on April 13, he posted a denial.
How are these tariffs affecting the U.S. economy overall?
On consumers, we anticipate the tariffs that have been imposed to date will cost the typical American household about $4,000 and will weigh more heavily on lower-income households, which tend to spend a larger share of their income on traded goods.
Tariffs also impact global competitiveness. Fifty-six percent of everything the United States imports is raw materials that manufacturers use to make their products domestically. Higher costs go right into the margins of manufacturers and, in many cases, compel them to raise their prices. If their prices are forced up, they're not going to be as able to compete in international markets.
Where do the proceeds of the tariffs go? Who gets the money collected and what is the intended use of the money received?
Tariff proceeds go directly to the U.S. Treasury, just like any other taxes such as payroll taxes or income taxes. They are not earmarked for any particular use.
And even though these tariffs are very broad and at the highest level we've seen in a century, the revenue collected is not as large as you might think. The tariffs are so high that they're simply blocking a lot of the imports that would otherwise come in, and therefore you don't get a lot of revenue. For example, what we saw back in 2018-2019 was that it took all of the tariff revenue to fund the support that was later given to American farmers and ranchers who were harmed by the trade war.
There are lawsuits. What’s happening in the courts and how will the lawsuits impact current tariffs?
There have been several lawsuits challenging the President's authority to impose tariffs under IEEPA, the International Emergency Economic Powers Act. Since the 1970’s the law has never been used to impose tariffs, and there are really good legal arguments that it can't be used to impose tariffs.
However, even if the courts rule that the President is unable to use IEEPA to impose these tariffs, he could almost instantaneously replace the IEEPA tariffs with identical tariffs under other statutes—which would have to start the court process all over. The court rulings on the IEEPA issue will be an important question for the future, but in terms of near-term tariff relief, the President could replace those tariffs with other things.
What should small businesses be doing to navigate the impacts of tariffs?
Higher tariffs are posing real challenges to small businesses across the country. Here are some strategies we have heard small businesses are deploying to help cope with higher tariff costs.
- Companies can work to diversify their supply chains by seeking alternative suppliers in countries with lower tariffs, or, exploring domestic sourcing to reduce dependency on imports.
- Some small businesses are negotiating with current suppliers to absorb part of the tariff costs. Also consider bulk purchasing or long-term contracts to secure better pricing.
- Many small businesses are raising prices. Make sure to transparently communicate cost changes to customers.
- Take this time to reassess budgets and reduce non-essential costs.
- Stay informed with the latest trade policy changes to anticipate market shifts and be ready to adjust your operations as necessary.
Does the U.S. Chamber have data tracking small business sentiment?
Yes. The U.S. Chamber of Commerce releases a quarterly Small Business Index that measures the confidence of small business owners on the economy and their own business operations. Our Q1 Index, released in March, has already captured some of the growing uncertainty from small businesses with spikes in concern about revenue and cash flow.
We also compile and analyze small business data from other organizations in our Small Business Weekly Update. Many of these regular surveys are beginning to capture the downward spiral in small business sentiment, especially related to future growth.
What is the U.S. Chamber doing in Washington to address the impact of tariffs? How can local Chambers help support this advocacy?
The Chamber has pressed a wide array of members of the administration and Congress to reject the use of broad-based tariffs. We are working with our members — especially small businesses — to help them tell officials how they are being harmed by the tariffs.
The Chamber sent a letter asking the administration grant tariff exclusions for small businesses, for products not readily available from domestic sources, and in cases where tariffs threaten American jobs.
We are providing timely updates and resources to help small businesses and state and local chambers navigate the changes. We encourage chambers to share the resources below with their members and communities.
Lawmakers are often influenced when they see the real-world consequences for small businesses in their districts. The best form of advocacy is factual presentations of what's happening. You can share your tariff impact story with us here.
Understanding Tariffs
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About the authors
Neil Bradley
Neil Bradley is executive vice president, chief policy officer, and head of strategic advocacy at the U.S. Chamber of Commerce. He has spent two decades working directly with congressional committee chairpersons and other high-ranking policymakers to achieve solutions.
John G. Murphy
John Murphy directs the U.S. Chamber’s advocacy relating to international trade and investment policy and regularly represents the Chamber before Congress, the administration, foreign governments, and the World Trade Organization.
