MV TELEGRAPH

China News Service | China News Service | Getty Images

The Trump administration’s trade truce with China that paused the steepest tariffs on Chinese goods isn’t offering much of a reprieve to many importers. Stacking of multiple tariff layers already implemented during the trade war has pushed up costs to import retail goods much higher than the 30% associated with the tentative agreement.

“While companies are relieved to see a temporary pause from the incredibly high tariffs on goods from China, retailers are still facing very high tariffs that will have an impact on prices and supply,” said Josh Teitelbaum, senior counsel of Akin.

“Multiple layers of tariffs are a big problem for basic items like kids backpacks that come largely from China,” said Dan Anthony, president at Trade Partnership Worldwide. “You’re talking about rates of over 70%,” he said.

That includes the layering of existing 17.6% tariffs and Section 301 tariffs (related to unfair trade practices) of 25%, with the 30% in tariffs on Chinese goods not included in the pause — 20% fentanyl-related tariffs and 10% reciprocal tariffs.

Walmart CFO John David Rainey said in a CNBC interview after its earnings this week that prices of goods including food, toys, and electronics may increase due to tariffs. “We’re trying to navigate this the best that we can,” he said in the CNBC interview. “But this is a little bit unprecedented in terms of the speed and magnitude in which the price increases are coming,” he added.

Panjiva data shows from January 2025 to May 12, Walmart’s top three countries where shipments originate from are China (34.1%), followed by India (26.3%), and Hong Kong (10.6%).

For many importers, the true tariff tax on Chinese goods now ranges from 40% to 70%.

Teitelbaum offered footwear as an example, with a children’s or women’s sneaker that has a leather upper facing a 40% tariff if imported from China today, factoring in the “most favored nation” standard tariff under WTO rules of 10%, plus the 30% in fentanyl and reciprocal tariffs.

That stacking of tariffs pushes the true cost for many other retail goods much higher than 30%, including:

• Cotton sweaters from China face a 46.5% tariff (16.5% most favored nation plus the fentanyl and reciprocal tariffs).
• Women’s bathing suits from China face a tariff of 54.9% (24.9% most favored nation plus the fentanyl and reciprocal tariffs).
• Baby’s dresses from China face a tariff of 41.5% (11.5% most favored nation plus the fentanyl and reciprocal tariffs).

Matt Priest, president & CEO of the Footwear Distributors & Retailers of America, told CNBC that a 40% tariff on the most popular category of imported women’s and children’s leather footwear is simply unsustainable for American families and footwear companies.

“These are everyday shoes — not luxury items — and applying compounded tariffs on them only drives up costs at the cash register,” said Priest. “With nearly $650 million worth of these shoes imported from China last year, it’s clear this policy disproportionately impacts working-class consumers. It’s time for a serious, bipartisan conversation about tariff reform that puts American families first.”

This stacking of tariffs has led some small businesses to cut product lines as a way to mitigate the financial strain. Anjali Bhargava, founder of spice company Anjali’s Cup, says her company will be discontinuing products as the special vacuum seal tins she uses sell out.

Even before the 30% tariffs hit, she was paying 25% in tariffs. “These tins were already more expensive than I could afford, but even if I could absorb the 30% tariff, as a small business owner handling so much on my own, I can’t afford the added stress of uncertainty about how the story might change during the months it would take to produce and ship the tins,” Bhargava said. “The past few months have been so destabilizing,” she added.

Bhargava said it is critical to maximize the potential of the working capital she has available and minimize unnecessary risks, given how expensive debt has become. Bhargava’s line of credit increased in interest rate to 23%, plus 2% to pull the money.

“My credit card interest rates are all in the high 20s so interest is a huge issue and ordering tins five to six months before I can sell them has been a big bottleneck,” Bhargava said. “I used what I could to buy the ingredients and packaging that are essential for those products and now I have to focus on building a stronger foundation for the company with those.” 

Rick Woldenberg, CEO of Learning Resources, a family-owned company that makes educational toys and is suing the Trump administration over the tariffs — a hearing scheduled for May 27 — is only facing the 30% tariffs, but he said the jump from zero to 30% is steep. Even if the pause does put his company in a position of importing some items again, it comes at a high price. 

“A 30% duty rate, when we used to pay zero, is a massive change in costs and will force a large price increase to cover it,” said Woldenberg. “I believe this tax is highly inflationary.  We don’t like the idea of participating in driving up inflation, so we are hardly rejoicing over the news.”

He said a book of finished goods and work in progress in China that was part of production orders due in the 45-60 days after Trump’s April 2 global tariffs announcement will likely be imported from Chinese factory partners. “We now can and probably should relieve them of this inventory and try to sell it here. We will selectively restart production of particularly sensitive products, for various reasons, but resourcing continues and our migration away from China remains active,” Woldenberg said.

The small business owners all say the tariffs have taken a toll on the business and their trust in the process.

“We still don’t know what our costs are or will be, and assume that future decisions by this administration will be last minute, without advance notice and cause us further pain and disruption. We have no confidence looking forward,” Woldenberg said. 

Rick Muskat, president of family-owned shoe retailer Deer Stags, which imports its goods from China and sells in major retailers including Macy’s, Kohl’s, JCPenney, and on Amazon, said even with the lowering of the Chinese tariffs, the stacking of all existing tariffs has increased exponentially.

“Even at the ‘reduced’ level this will cause serious cashflow problems,” said Muskat. “We were paying $60,000 per month. Now we are paying $360,000 per month. We have to cut expenses to cover this and find savings in payroll. It will also require us to raise prices for future deliveries,” he said.

“The damage of the past weeks cannot be undone and can only be addressed with some sort of longer term assurances and stability that enable us to make the best decisions on how to spend our money today, next week and next month, and set ourselves up for success in the future,” Bhargava said. “I will survive and I’m pretty optimistic that the business will too, but the stress to figure it out has been rough and has taken a toll on me. I’ve needed to really slow down and not panic, but I’m finding my way, step by step.”

Charter Communications and Cox Communications, two of the largest cable companies in the U.S., have agreed to merge. 

The deal would be one of the largest in the industry – and across corporate America – in the last year. 

The agreement values Cox at $34.5 billion on an enterprise basis – comprised of $21.9 billion of equity and $12.6 billion of net debt and other obligations – in line with Charter’s recent enterprise value based on 2025 estimated adjusted earnings before interest, taxes, depreciation and amortization multiple, according to a Friday news release. 

Shares of Charter — the second-largest publicly traded cable company behind Comcast — closed slightly higher Friday. Privately run by the Cox family, Cox is among the biggest cable providers, too. 

On a Friday call with investors, Charter CEO Chris Winfrey called the deal “good for America” and said it will “return jobs from overseas and create new, good paying customer service and sales careers.”

The commentary comes as corporate deal activity has been slower than expected since President Donald Trump took office.

After Trump won the election, Wall Street rallied as many expected the regulatory environment to loosen and the flood gates to open for dealmakers and corporate leaders. But in the months following the election, companies have been contending with other factors rather than dealmaking, such as the Federal Communications Commission’s investigation into diversity, equity and inclusion practices, and the outcome of Trump’s tariffs.

Last fall communications giant Verizon announced a proposed $20 billion acquisition of Frontier Communications. However the deal has yet to receive regulatory approval as Verizon is being investigated for its DEI practices.

Charter’s Winfrey said on Friday the companies expect “to go through a fulsome process.”

The merger with Cox comes months after Charter announced it would acquire Liberty Broadband in an all-stock deal that simplifies cable pioneer John Malone’s portfolio. In February, Charter and Liberty Broadband stockholders approved the proposed deal. 

Charter expects there to be about $500 million in annualized cost synergies within three years of closing, according to the release.

The merger agreement with Cox is expected to close at the same time as the Liberty Broadband merger, the companies said Friday. Winfrey said on Friday’s call it’s hard to pinpoint timing, but said “we think that could be in the next year, mid next-year. But of course, we’ll follow the lead of regulators and work with them productively.”

Cable combo

Christopher L. Winfrey, CEO of Charter Communications.

Courtesy: Charter Communications

The broadband industry has been contending with heated competition from wireless competitors in recent years as there’s been a rise in alternate home internet options like 5G, or so-called fixed wireless. This follows the continued loss of customers from the traditional cable TV bundle.

Charter had 30 million broadband customers at the end of the first quarter, a decline of 60,000 from the prior period. It had about 12.7 million cable TV customers, with 181,000 losses during the quarter.

Cable companies have begun to lean on their mobile businesses to retain customers, and Charter has been aggressive in its pricing and bundling of mobile lines. Charter said it had 10.5 million mobile lines as of the first quarter after reporting another quarter of growth.

The company provides its services in 41 states, and is available to more than 57 million homes and businesses. As of March 31, Charter said it had a total of 31.4 million customer relationships.

Cox Communications — a division of Cox Enterprises — counts itself as the largest privately held broadband company in the U.S., and has approximately 6.5 million total residential and commercial customers, per its website.

On Friday’s investor call Charter CFO Jessica Fischer provided details on Cox’s business. The company has 6.3 million customers, including 5.9 million signed up for internet. Cox generated $13.1 billion in revenue in 2024, she said.

Cox’s services are available to 12 million homes, and its network infrastructure reaches more than 30 states. It began offering mobile in 2023.

The combined company’s network will span approximately 46 states, making it available to nearly 70 million homes and businesses, with 38 million customers, Winfrey said Friday.

By comparison, Comcast, the largest cable provider in the U.S., reported it had roughly 51.4 million total customer relationships, which includes 17.8 million international customers. Comcast had roughly 34 million total domestic customer relationships, and was available to nearly 64 million homes and businesses in the U.S. as of March 31.

Upon closing of the merger, Cox Enterprises will own roughly 23% of the combined company’s fully diluted shares outstanding, according to the release. 

The transaction will see the combined company change its name to Cox Communications within a year after the deal closes. Charter’s Spectrum, the brand on its cable, broadband, mobile and other services, will become the consumer-facing brand across all customers.

The combined company will take on Charter’s current headquarters in Stamford, Connecticut, although it will keep a significant presence in Cox’s home base in Atlanta after the closing. 

Charter’s Winfrey will remain at the helm as president and CEO following the close of the deal. Meanwhile Alex Taylor, chairman and CEO of Cox Enterprises, will become chairman of the combined company’s board. Another Cox executive will join the board, and the Cox family will have the right to retain two board members. 

Disclosure: Comcast is the parent company of CNBC.

Don’t miss these insights from CNBC PRO