Tariffs paid by “middle market” companies in the United States have surged, according to a new analysis from the JPMorganChase Institute that uses payments data to examine which firms are paying the added import costs.
The JPMorganChase Institute research, published Thursday, found that tariffs paid by midsize U.S. businesses tripled over the course of the past year, adding to a growing body of economic analysis that challenges the Trump administration’s argument that foreign entities—not U.S. firms and consumers—are bearing the burden.
Chi Mac, the business research director of the JPMorganChase Institute, said the tariffs have represented “a big change in their cost of doing business.” In the same remarks, Mac said the researchers also saw indications that companies may be shifting away from transacting with China and toward other regions in Asia.
The JPMorganChase Institute analysis said it does not attempt to trace exactly how the additional tariff costs flow through the broader economy. Instead, it focused on companies that might have less ability than large multinationals to offset tariffs, while still being small enough to adjust supply chains quickly—specifically firms in a category described as “middle market,” with revenues between $10 million and $1 billion and fewer than 500 employees.
According to the researchers, the extra taxes have forced companies employing a combined 48 million people in the United States to find ways to absorb the expense. The report said firms have responded by passing the costs along to customers in the form of higher prices, employing fewer workers, or accepting lower profits.
The analysis also suggested that President Trump’s push to reduce reliance on Chinese manufacturers has been occurring in at least some form. The report said payments to China by these midsize firms were 20% below their October 2024 levels, though the researchers said it was unclear whether China is simply rerouting its goods through other countries or whether supply chains have moved.
The JPMorganChase Institute team emphasized to reporters that companies were still adjusting and that the authors planned to continue studying the impact. Their approach, the researchers said, used payments data to look directly at whether tariffs were being paid by U.S. companies, rather than assuming the burden falls elsewhere.
The White House rejected the findings. White House spokesman Kush Desai called the analysis “pointless” and said it didn’t “change the fact that President Trump was right,” asserting that the study showed U.S. companies were paying tariffs that Trump had previously claimed foreigners would pay.
Trump has defended the tariffs in multiple settings, including during a visit to Georgia to tour Coosa Steel. The president said he could not believe the Supreme Court would soon decide on the legality of some of his tariffs, arguing that they were helping U.S. manufacturers, and he said, “The tariffs are the greatest thing to happen to this country.”
The tariffs were imposed last year with the stated goal of reducing the U.S. trade imbalance and cutting the amount the United States imports relative to what it exports. But trade data published Thursday by the Census Bureau showed the trade deficit climbed last year by $25.5 billion to $1.24 trillion, contradicting Trump’s prior claim on social media that he expected a trade surplus “during this year.”
The dispute over tariff costs has also been tied to fights over economic research. Kevin Hassett, director of the White House National Economic Council, criticized New York Federal Reserve research that found nearly 90% of the burden for Trump’s tariffs fell on U.S. companies and consumers, calling the study “an embarrassment” and saying it was “the worst paper I’ve ever seen in the history of the Federal Reserve system.”
Trump increased the average tariff rate to 13% from 2.6% last year, according to the New York Federal Reserve researchers described in the report. He also declared an economic emergency to bypass Congress and impose a baseline tax on goods from much of the world in April 2025 at an event he called “Liberation Day,” a move the Supreme Court is expected to address soon as it considers whether he exceeded his legal authority.
While inflation had not surged during Trump’s term as of now, the report cited assessments that tariffs have added pressure on consumer prices and that hiring had slowed sharply. A team of academic economists estimated consumer prices were roughly 0.8 percentage points higher than they otherwise would have been—an affordability strain that has contributed to voter frustration as the legal fight over tariffs moves toward a decision.