October 29, 2018 at 5:00 am ET
What do costumes, haunted houses and tariffs have in common? All three will give people a fright during Halloween season.
Thanks to the latest round of import taxes that took effect last month, the trade war will be an unwelcome trick-or-treater at the doorsteps of every American celebrating Halloween beginning in 2019.
While agriculture and manufacturing felt the sting in the first waves of tariffs, the most recent round hits where most Americans feel it. The new 25 percent duty means prices will increase virtually overnight for clothes, groceries, furniture — even Halloween decorations.
Halloween is a major retail holiday, and tariffs will cause major pain for the 175 million Americans who partake in festivities, decorate their homes, visit theme parks, host parties and buy costumes for their kids. The annual National Retail Federation survey found that Halloween is a $9 billion holiday, with Halloween shoppers spending more than $3 billion on costumes, $2.7 billion on decorations, $2.6 billion on candy, and almost a half-million dollars on greeting cards. A new 25 percent tax will send those costs skyrocketing.
For the Halloween industry, business has been booming and trending upward for more than a decade. The Halloween Industry Association represents small businesses across the country operated by people who rely on a healthy retail industry to make a living. The Halloween season can make or break these businesses. Tariffs that raise prices will lead to slower sales and could potentially deliver serious blows to the industry.
Critically, the NRF survey revealed that 80 percent of Halloween shoppers will buy their supplies at Halloween-themed specialty stores and discount stores. Unlike larger retailers, which see more consistent year-round sales, these specialized businesses are especially reliant on seasonal purchases.
When President Donald Trump announced a first wave of tariffs on foreign goods earlier this year, many Americans might have overlooked the news. For many people, tariffs might seem like a distant concept that only affects a few items or industries.
But the tariff waves have not stopped. In late September, the White House announced a third round of duties, placing the United States in the middle of a trade war with foreign economic powers.
While that might seem like a far-off problem, the trade war has real consequences here at home. Seasonal shoppers will be among the first to feel the pain of higher prices, and that pain will persist throughout the holiday shopping season and into next year’s Halloween season if we don’t shift course soon.
Tariffs are hidden, regressive taxes that raise prices, hurt sales, and make the future unpredictable. Businesses rely on stable and predictable conditions to plan for growth, make investments, hire new workers, manage expenses and prepare for slow periods. That doesn’t just apply to seasonal retailers like those in the Halloween industry. It’s also true for farmers, ranchers, manufacturers and any business that relies on imports or exports to deliver products to customers.
Retailers dealing with higher prices are likely to see fewer sales at a time when our economy otherwise seems to be moving in the right direction. Major retailers have cautioned that the trade war could lead to millions of lost jobs as costs rise and revenue dips.
Like most Americans, retailers, farmers and manufacturers,all want our foreign trade partners to abide by fair and equitable trade practices. The president and his administration clearly want to level the playing field. Unfortunately, the approach they’ve taken has only served to harm American businesses and workers in the short-term. The long-term damage could be even more frightening if we don’t end the trade war and allow free and fair trade to help our economy reach its full potential.
Michele Biordi is the executive director of the Halloween Industry Association.
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