Trump's tariffs are bringing in serious revenue-and it'd be even higher if not for tariff dodgers costing the government $40 billion a year, Goldman Sachs says | Fortune

"Goldman Sachs warned that export data indicates increased rates of transshipments from China to the U.S. through third-party countries-a similar pattern observed during the 2018 trade war. The tariff evasion taking place today could impact more than $200 billion in U.S. imports, costing the U.S. $40 billion in tariff revenue if efforts to curb the sidestepping aren't mitigated, bank analysts Joseph Briggs and Megan Peters said in a report."

"As Trump imposes sweeping tariffs on countries-most recently a 100% tax on imported branded pharmaceuticals going into effect on Oct. 1-some companies have tried their best to take action to evade the levies. Many have warned that they face an impact worth billions of dollars each year. Goldman highlights the practice of transshipping, or reorganizing a supply chain to ship products from a country with lower imposed levies."

Export data points to increased transshipments from China to the U.S. via third-party Asian countries, particularly Vietnam, mirroring patterns from the 2018 trade war. The scale of the shifts could affect more than $200 billion of U.S. imports and reduce tariff revenue by an estimated $40 billion if evasion persists. Companies facing sweeping tariffs, including a 100% tax on imported branded pharmaceuticals, are altering supply chains, underreporting values, or mislabeling goods to avoid levies. UN Comtrade data shows coincident rises in exports to the U.S. and imports from China, and the speed of change suggests deliberate sidestepping of tariffs.

Read at Fortune