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Former President Donald Trump said he would expand his tariff policy, imposing tariffs of up to 20 percent instead of the previously proposed 10 percent.

At a rally in North Carolina on Wednesday, Trump focused on inflation and the cost of living, a key issue for voters. As part of his economic policy arguments, Trump vowed to bring manufacturing back to places like North Carolina and to tax imports more heavily.

“We will impose tariffs of 10 to 20 percent on the countries that have ripped us off for years. We will charge them 10 to 20 percent to come into our country and take advantage of it, because that is what they have always done,” he said at the rally.

Global trade experts warn against comprehensive tariffs – a type of tax that one country imposes on goods and services imported from another country – because they generally harm the economy.

RNC spokeswoman Anna Kelly said in a statement to USA TODAY: “President Trump has put America first by imposing tariffs while keeping inflation and consumer prices low… He will once again cut taxes, impose tariffs on foreign producers, bring jobs back to the United States and put America first from day one.”

More: Trump criticizes food prices and inflation at campaign stop in North Carolina, Harris gains ground

What is a tariff?

A tariff is a type of tax levied on imports from another country.

According to the Tax Foundation, a nonpartisan, nonprofit tax policy organization, economic theory generally shows that higher trade barriers raise consumer prices and negatively affect economic output and income.

Garrett Watson, senior policy analyst and modeling manager at the Tax Foundation, told USA TODAY on Thursday that some argue for tariffs to stimulate demand among domestic manufacturers, even though they are also part of the global supply chain that could be affected by tariffs.

National security is also an argument for introducing tariffs to secure domestic production.

Watson also said it was difficult to estimate the extent of the economic damage because other countries had the opportunity to respond to the US with their own tariffs.

“There's a lot of uncertainty right now about the extent and nature of foreign retaliation,” Watson said. “That's actually an important piece of the puzzle because that would obviously hurt exporters and cause additional economic damage to the United States.”

WTO chief: 10% import tariff is a lose-lose situation

Before the rally in North Carolina, Trump had touted 10 percent trade tariffs on all imported goods and 60 percent tariffs on imports from China.

According to an analysis by the Tax Foundation, these two tariffs together would lead to lower imports and income. Moody's estimates that the 10 percent tariff would result in 2.1 million fewer jobs in the U.S. and a 1.7 percent smaller economy by 2028.

According to Reuters, World Trade Organization chief Ngozi Okonjo-Iweala said in April that the 10 percent tariff would trigger retaliation from partners, creating a lose-lose situation.

“And then I think there will be a little tussle that will turn the stability and predictability of trading on its head,” she said at an event.

The proposal to impose 10 percent across the board tariffs is “a pretty big escalation of the former president's tariff threats compared to the tariffs he imposed in his first term,” Watson said. “And of course, if he were to impose 20 percent, or something between 10 and 20 percent, it would make the situation even worse.”

Biden has kept many Trump tariffs

A spokesman for the Trump campaign claimed that the Biden administration was weak on foreign trade and was crippling US manufacturing.

Trump waged a trade war during his first term, imposing tariffs on a tenth of U.S. imports, which were limited to products such as steel, washing machines and solar panels, as well as goods from China.

President Joe Biden has kept many of the tariffs imposed by Trump and even increased them on certain products such as Chinese electric vehicles and solar panels.

The Tax Foundation's analysis found that the tariffs total $79 billion, which theoretically translates to an additional $625 in taxes for the average U.S. household. The Tax Foundation also argues that the tariffs have an overall negative impact on the U.S. economy by raising prices and reducing production and employment.

Watson also explained that both Trump and Vice President Kamala Harris have put forward ideas on tax policy without explaining how they fit into their broader policy agenda.

“It's unclear what the guiding principle is here, where these numbers are coming from,” Watson said. “Is it an attempt to offset other tax changes, or is this just what the people who support these tariffs like? That would be the big question.”

Contributors: Paul Davidson, Hannah Hudnall

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