Analyzing the Potential Impact of Tariffs on This Year's Holiday Shopping Season

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This holiday season, American consumers might find themselves facing steeper prices on a range of imported goods, from clothing to electronics, due to the impact of tariffs. As analyzed by LendingTree, these tariffs could significantly influence the cost of holiday shopping.

According to LendingTree’s estimates, if current tariffs had been applicable last year, the holiday gift expenses for American consumers would have surged by an additional $28.6 billion. This translates to an extra $132 per shopper, a burden that many might find substantial.

Matt Schultz, LendingTree’s chief consumer finance analyst, remarked on the implications of these findings, stating, “For most Americans, spending an extra $132 during the holidays is significant. It may lead people to either reduce their gift-giving or incur more debt.”

Electronics would have been the hardest hit by these tariffs, potentially adding $186 to each shopper’s expenses, with clothing and accessories not far behind at $82. These two categories, primarily comprising imports, would have contributed to about 60% of the additional costs borne by consumers.

Last year, nearly $378 billion was spent on imported goods during the gift-giving months of November and December. With many of these products now subject to tariffs, consumers may need to brace for a more expensive holiday shopping experience.

The precise impact on this year’s holiday season will ultimately depend on how much of those tariff costs companies pass on to consumers.

American consumers are expected to shoulder 55% of the costs from President Donald Trump’s tariffs this year, according to a recent Goldman Sachs analysis reported by The Hill, NewsNation’s partner. U.S. businesses and foreign exporters are expected to absorb 22% and 18% of the costs, respectively.

Prices for popular gaming consoles Xbox and PlayStation have already gone up in the U.S., with both Microsoft and Sony citing the broader economic environment. The price of the original Nintendo Switch has also increased in the U.S. recently, which the company attributed to “market conditions.”

Higher tariffs are also beginning to show up in broader inflation data, especially when it comes to rising goods prices. Even so, the impact so far has been milder than many feared, and Fed officials are hopeful the levies won’t spark a new inflationary cycle.

Annual inflation ticked up to 3.0% in September, up from 2.4% in March but far below the 9.1% high in June 2022, according to the Consumer Price Index.

Still, consumers are bracing for holiday price hikes, with 85% expecting higher costs because of tariffs, according to a recent National Retail Federation survey. Despite those concerns, the NRF found that winter holiday spending is projected to remain strong — averaging $890 per person, the second-highest amount in the survey’s 23-year history.

“Time and again, Americans prioritize spending on loved ones for holidays despite economic uncertainty,” Katherine Cullen, NRF vice president of industry and consumer insights, said in a statement.

Recent economic data suggests consumer spending has held up, though much of that resilience is being driven by high earners — the top 10% of whom now account for roughly half of all spending.