A proposed 20 per cent tariff on Mexican imports to pay for the wall along the US-Mexico border will be passed back to US consumers in the form of higher prices for avocados, tomatoes and other key imports, experts say.
The idea was mooted on Thursday by the White House, who claimed the tariff could raise US$10bn a year to meet the cost of the wall, which is estimated to be US$12-15bn. But the next day the Trump administration appeared to backtrack on the proposal, claiming it was one of “a buffet of options” available to pay for the wall.
Mexico’s foreign minister Luis Videgaray warned: “You’re going to make things ranging from avocados to appliances to flat-screen TVs more expensive”.
Mauro Guillen, global economics professor at the University of Pennsylvania, said the tariff was “insane”. “What you’re doing is taxing American consumers. Everything from Mexico will become more expensive,” he told USA Today.
Mexico is the US’s biggest trade partner for fruits and vegetables. In 2015 the US imported US$21bn worth of agricultural products, including US$4.8bn of fresh vegetables and US$4.3bn of fresh fruit.
Under US law, Trump could impose the tax temporarily for a 120-day period, after which it would have to be passed by congress.
With Super Bowl Sunday fast approaching on 5 February, social media has erupted in a wave of indignation as users face up to the prospect of having to pay considerably more for their guacamole. A record 278m avocados were sold during the 2016 Super Bowl weekend, the bulk of these hailing from Mexico.
Earlier this week, Avocados From Mexico published a teaser for its new Super Bowl commercial, featuring actor Jon Lovitz and a hypnotic green background.