Tariffs paid by midsize U.S. companies tripled over the past year, a JPMorganChase Institute study released Thursday found, offering new evidence that Trump’s import tariff push has landed on American firms rather than on foreign governments or exporters. The analysis used payments data and focused on the “middle market” of companies—those with revenues between $10 million and $1 billion and fewer than 500 employees—who the study authors said may have less pricing power to absorb tariff increases.
In the study, JPMorganChase Institute business research director Chi Mac said the change in costs was significant for companies operating under the tariff regime. “That’s a big change in their cost of doing business,” Mac said. He also told reporters that the institute saw “some indications” companies were changing their trading patterns, including potentially “shifting away from transacting with China and maybe toward some other regions in Asia,” as the additional taxes reshaped how firms manage sourcing and costs.
The study did not map out exactly how the extra expenses flow through the broader economy, but it said companies have been responding to higher costs. The analysis described ways firms have handled the new expense: by passing it along to customers through higher prices, employing fewer workers, or accepting lower profits.
JPMorganChase Institute researchers said the question of who pays tariffs is central to interpreting the economic disruption. The institute said the findings add to “a growing body of economic analyses” that counter the administration’s position that foreign entities pay the tariffs. The payments data, the institute said, showed tariffs were being paid by U.S. companies.
The research also examined whether companies were reducing direct purchases from China. It said payments to China by this group of firms were 20% below their October 2024 levels, while noting it was unclear whether that shift reflected rerouting goods through other countries or actual movement of supply chains. The authors emphasized in interviews that companies were still adjusting to the tariff costs and that the institute planned to continue studying the issue.
Trump and his aides have rejected findings that contradict the administration’s framing. White House spokesman Kush Desai called the institute analysis “pointless” and said it did not “change the fact that President Trump was right,” according to the report. Desai’s comments came as Trump defended his tariffs during a trip to Georgia on Thursday while touring Coosa Steel, a company involved in steel processing and distribution.
During the Georgia visit, Trump said he could not believe the Supreme Court would soon decide on the legality of some of his tariffs, because he believes the taxes were helping U.S. manufacturers. “The tariffs are the greatest thing to happen to this country,” Trump said.
Trump imposed a series of tariffs last year, saying the goal was to reduce the U.S. trade imbalance with other countries. Yet trade data published Thursday by the Census Bureau showed the trade deficit climbed last year by $25.5 billion to $1.24 trillion. On Wednesday, Trump posted on social media that he expected the U.S. would run a trade surplus “during this year.”
In addition to rejecting the JPMorganChase Institute findings, Trump’s economic team has also attacked research that has challenged the administration’s “foreign pays” argument. Kevin Hassett, director of the White House National Economic Council, lashed out on Wednesday at research by the New York Fed that found nearly 90% of the burden for Trump’s tariffs fell on U.S. companies and consumers. The report said Hassett told CNBC, “The paper is an embarrassment,” adding, “It’s, I think, the worst paper I’ve ever seen in the history of the Federal Reserve system. The people associated with this paper should presumably be disciplined.”
Trump increased the average tariff rate to 13% from 2.6% last year, according to the New York Fed researchers referenced in the report. He has also declared tariffs on some items, including steel, kitchen cabinets and bathroom vanities, to be in the national security interest. Separately, Trump declared an economic emergency to bypass Congress and impose a baseline tax on goods from much of the world in April 2025, in an event he called “Liberation Day.”
The high tariff rates provoked a market panic, leading Trump to walk back the rates and later pursue talks with multiple countries that produced new trade frameworks. The Supreme Court is expected to rule soon on whether Trump exceeded his legal authority when he declared the economic emergency. Trump was elected in 2024 on a promise to tame inflation, and while inflation has not spiked during his term so far, hiring slowed sharply, and the report said a team of academic economists estimated that consumer prices were roughly 0.8 percentage points higher than they otherwise would have been.