A sudden rollback of tariffs on Chinese imports has left small business owners across the U.S. frustrated and financially drained, with many saying they paid the price for a policy that changed overnight, literally.
Former Rep. Tom Malinowski (D-NJ), who represented New Jersey’s 7th District, said in a post on X: “Spare a thought for the small business owners who had to beg and borrow to pay a $145,000 tax on that $100K shipment of product that happened to arrive while the most extreme China tariff was in place, only to see their president back down with zero Chinese concessions.”
The 90-Day Pause That Came Too Late
President Donald Trump agreed on Monday to a temporary de-escalation with China that cuts tariffs on Chinese imports from 145% to 30% for the next 90 days.
The move came after fears of empty shelves during the holiday season and warnings from major industry leaders about inflation and stalled supply chains.
But for companies whose shipments landed during the peak of the tariff spike, the damage is done.
Rick Woldenberg, CEO of Learning Resources, called the 145% rate “100 billion percent” in effect.
It was so high, he paused shipments, stopped hiring, and even sued the administration.
Now that tariffs are reduced, he said he might resume some imports, but warned, “Who the hell knows what they’ll do next.”
A Tax That Hits Everyone
The broader picture isn’t much better.
Malinowski noted the U.S. still faces a “permanent inflationary tax” with a 10% tariff on all foreign imports.
“It’s a double tax on companies that manufacture in the USA — increasing the cost of parts & materials they import and tariffs on what they export,” he wrote.
Prices are up not only on electronics or machinery, but everyday items like bananas and rubber for tires that the U.S. doesn’t produce.
Uncertainty Reigns
Despite the temporary truce, the instability in U.S. trade policy remains a core concern. Trump has reversed course multiple times, imposing tariffs, increasing them, and then pulling back, sometimes in a single day.
The result? A record high in the Economic Policy Uncertainty Index, even higher than during the 2008 crisis or the COVID-19 pandemic.
“They don’t know what’s going to happen,” said Austan Goolsbee, president of the Federal Reserve Bank of Chicago.
“They can’t make decisions counting on this or any other thing lasting in a permanent way.”
Even the Federal Reserve is in wait-and-see mode.
Economists at Wells Fargo and elsewhere say the lack of consistency makes it impossible to plan for interest rates or broader fiscal responses.
A So-Called Victory
The White House insists the strategy worked. National Economic Council Director Kevin Hassett told CNN, “We actually have a fresh start with China.”
Treasury Secretary Scott Bessent echoed that in Geneva, saying, “We have a process in place, now with the Chinese, we have a mechanism in place for future talks.”
But critics argue the U.S. got little in return. China hasn’t made any firm new concessions, and the 10% global tariff remains.
Malinowski said the administration not only harmed small businesses and industries like auto manufacturing but also alienated allies who could have helped form a united front against unfair Chinese practices.
“Catastrophe averted (phew), but huge harm done,” he wrote.
Holding the Bag
For now, small business owners who took the hit are still waiting for answers.
“We’re clinging to every dollar,” Woldenberg said. “We’re going to need them because I have a new tax I have to pay.”
And if the 90-day pause ends without a permanent deal? Tariffs could go back up. As Trump himself said, if China doesn’t comply, duties will return “substantially higher.”
In the end, the question isn’t just what the tariff rate will be next month. It’s whether businesses can keep running in a climate where policy changes come with no warning and no recourse.
“This is, I suppose, better than the other kinds of chaos we were going through,” Woldenberg said.
This whole episode has left small businesses caught in the middle of a volatile trade strategy that changes without warning, adds unpredictable costs, and leaves little room for long-term planning.
While a crisis may have been avoided, the underlying instability remains, and businesses are still paying the price.