Proposed U.S. tariffs related to Iran-related trade could spill over into global supply chains, raising import costs and worsening household affordability, as China’s central role under President Trump’s evolving sanctions strategy magnifies indirect effects.
Schiff warns prices could rise due to Iran-related tariffs
Economist and gold advocate Peter Schiff shared on social media platform
“President Trump has threatened Americans with 25% tariffs on imports from countries that do business directly or indirectly with Iran,” he said. Schiff developed his argument as follows.
“China does business with Iran, and almost every country does business with China, so it will only get worse if President Trump gets through the economic crisis.”
His post framed the tariff mechanism as a chain reaction rather than a narrow trade instrument, emphasizing indirect exposure through global supply networks.
The comments came after President Trump signed an executive order on February 6 establishing a framework for tariffs that may be imposed on countries that purchase goods and services from Iran, either directly or through intermediaries. The order cited 25 percent as an example of a tax rate, but stopped short of requiring it to apply automatically. Under this structure, the Commerce Department would identify eligible trade relationships, the State Department would provide policy evaluations, and the President would retain the authority to impose, adjust, or waive. Analysts describe this approach as formalizing secondary sanctions through tariffs rather than financial restrictions.
China, Iran’s largest trading partner, remains a focus as additional tariffs could pile on top of existing trade war measures and raise the cumulative cost of certain imports. Supporters of the policy characterize it as an economic lever aimed at limiting Iran’s access to foreign currency while maintaining diplomatic flexibility, while critics like Schiff highlight the downstream price impact on households already facing rising costs of living.
read more: Trump tariff shock hits global markets as EU considers retaliatory measures
Mr. Schiff’s warning echoes the broader institutional alarm triggered by the Feb. 6 “secondary tariff” framework. On the same day, the Tax Foundation formally reported that President Trump’s 2026 tariff schedule would amount to an average annual tax increase of $1,300 per U.S. household. Similarly, Goldman Sachs analysts predicted that these taxes would increase inflation by 1% through mid-2026. At a controversial Feb. 4 hearing, Rep. Maxine Waters and other House Democrats characterized the strategy as a “war on consumers.” Additionally, the Council on Foreign Relations warned that layering these obligations on top of existing trade war rates would have a major impact on domestic affordability.
FAQ ⏰
- What tariffs did Peter Schiff warn about?
He warned that proposed 25% tariffs related to Iran-related trade could increase costs for U.S. consumers. - How will China get involved in the Iran tariff debate?
Extensive trade between China and Iran could lead to indirect tariffs across global supply chains. - What powers does an executive order give the president?
This allows the president to impose, adjust, or waive tariffs based on assessments by the Commerce and State departments. - Why do critics say tariffs could worsen affordability?
They argue that additional tariffs would overlap with existing trade war measures and increase import prices.
