Money Watch•2 MIN READ

Tariffs Are Costing the Average Household $700 This Year. Lower-Income Families Pay Proportionally Three Times More.

Alex Mercer

Updated Jun 29, 2026

The current U.S. tariff regime is costing the average American household roughly $700 this year in higher prices, according to separate analyses by the Tax Foundation and Yale University’s Budget Lab. That average masks a sharper reality: the burden falls hardest on those who can least afford it.

What You Should Know

The Tax Foundation estimated the current tariff package costs households $700 each in 2026. Yale’s Budget Lab placed the figure between $570 and $940, depending on whether the Section 122 tariffs are extended past their July 24 expiration. The Federal Reserve confirmed that tariffs raised core goods PCE prices by 3.1 percent through February 2026, ‘explaining the entirety of excess inflation in the core goods category.’

More than 90 percent of Americans surveyed by Pew in February 2026 said they were concerned about the price of food and consumer goods - with 66 percent reporting they were ‘very concerned.’

The Money Trail

The burden is heavily regressive. Yale’s Budget Lab found the lowest-income 10 percent of households bear a cost equivalent to roughly 1.1 percent of their after-tax income; for the top 10 percent, the figure is 0.4 percent. In dollar terms, the bottom decile pays approximately $517 per year in tariff-driven costs while the top decile pays roughly $2,175 - but as a share of income, the bottom decile’s cost is nearly three times higher.

Physical goods are most affected. Digital products and services have largely been spared. Families who spend more of their budget on clothing, electronics, and food manufactured with imported components face above-average exposure.

The Receipts

Tax Foundation (March 2026), Yale Budget Lab (April 2026), and the Federal Reserve (April 2026) all confirmed the household cost figures. CNBC confirmed the income-level distribution. The Pew February 2026 survey confirmed consumer concern levels.

What Happens Next

The Section 122 tariffs expire July 24. If Congress extends them, the per-household cost rises to $1,200-$1,500. If they lapse, it falls to $570-$940. In either scenario, the Section 232 tariffs on steel, aluminum, and pharmaceuticals remain in effect.

References: Tax Foundation | Yale Budget Lab | CNBC