The Indicator from Planet Money Three ways companies are getting around tariffs
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Aug 26, 2025 Businesses are cleverly navigating the complex world of tariffs to reduce costs. They employ strategies like 'tariff engineering' to comply with regulations while maximizing benefits. Companies are modifying product compositions, such as sweatshirts, to sidestep heavy import taxes. Additionally, the manipulation of sourcing components plays a key role in optimizing tariffs. Humorously, tales of kitchen mishaps remind us of the risks of makeshift solutions, highlighting the importance of proper tools in every situation.
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Two-Tier Tariff Regime Changes The Rules
- Trump's tariffs now include baseline and discretionary reciprocal levies that change the import math.
- Reciprocal tariffs reduce the usefulness of simple classification-based tariff engineering.
Sweatshirt Blend Cuts Tariff Rate
- A brand changed a sweatshirt's fiber blend toward cotton to drop its tariff from 22% to 12%.
- The change required new sourcing and manufacturing but saved enough per unit to justify the work.
Shift Core Part Production To Change Origin
- Consider product engineering by moving a key component's production to a low-tariff country to change country of origin.
- Focus on the