New tariffs have taken effect, and consumers could be paying more for everyday products, including building materials, groceries, and auto parts.

President Donald Trump’s sweeping tariffs on imports from Canada, Mexico, and China took effect at midnight. Those countries then announced they were adding their own tariffs on the United States, and the impact has been immediate.

Here’s a breakdown of how these new tariffs will impact local businesses and consumers in the Philadelphia region:

What are tariffs?

Tariffs are a tax on imports.

The new tariffs are taxes paid on goods imported from other countries. The United States will collect 25% on items from Mexico and Canada, and then an additional 10% will be added to Chinese goods, which is on top of a tariff already in place, bringing the total to 20% for goods from China.

Who pays for tariffs?

The American companies bringing in the goods will pay the tariffs. Those companies can either absorb the fees or pass the added costs along to consumers.

How will tariffs impact local businesses and consumers?

Experts believe these tariffs will drive up prices for things like groceries first, followed by products with an inventory, like cars. Some businesses are prepared to raise their prices, but others are not.

Local business owners are already discussing the 25% tariffs on goods from Mexico and Canada.

“Canada, Mexico, and China are our top three. In Pennsylvania alone, we have $60 Billion a year in bilateral trade with those three countries,” Chief Executive Officer and President at World Affairs Council of Philadelphia Lauren Swartz told NBC10.

Swartz shared that the fee on the United States’ largest trading partners will be significant for the economy.

“In this case, for products that are coming from Mexico, Canada, and China, in order for them to enter this country, an extra fee has to be paid,” Swartz said.

Vinnie Iovine, owner of Iovine Brothers Produce — located inside the Reading Terminal — shared with NBC10 that he isn’t making any changes yet.

“If it’s a beautiful red pepper and they’re from Mexico right now, they’re gorgeous, and it’s the right price. They’re going to sell faster, so why would I jack up the price? I want to keep selling and moving and keep customers happy,” Vinnie shared.

Iovine Brothers Produce has several products from Mexico on their shelves, and Vinnie told NBC10 his suppliers from Mexico haven’t raised their prices.

“These are living things, so you know if they have a lot of product, even if they get hit with tariffs, they need to move them because they get some money versus no money,” said Vinnie.

Meanwhile, at the farmer’s market in Rittenhouse Square, local suppliers like Emily Rohrer see a silver lining. An increase in prices at the grocery store means more customers are finding them to save money.

“We should be able to stay pretty much the same as far as prices go, but the grocery stores are gonna have to go up,” said Rohrer.

How long will the tariffs be in place?

Right now, it’s unclear how long these tariffs could be in place.

Swartz shared with NBC10 that consumers should have a budget and look around for better prices at different stores.