With Christmas Day fast approaching, along with Santa Claus and Rudolph the Red-Nosed Reindeer, we asked Gemini if Old Saint Nick was concerned about President Trump’s tariffs on children’s prospective toys …
While Santa is likely safe at the North Pole, his “helpers” (retailers and parents) are certainly feeling the heat this year. As we head into the peak of the 2025 holiday season, the trade policies under the current administration have significantly changed the landscape of gift-giving.
If Santa were an economist, here is what he would be tracking:
1. The “Naughty List” for Prices
The most popular categories on kids’ wish lists have seen the steepest price hikes due to the 10% to 20% tariffs on goods from China and 25% on imports from Mexico and Canada.
- Electronics: Prices for video game consoles and laptops have jumped as much as 34% to 69% compared to 2024.
- Toys & Games: Traditional toys and board games are roughly 17% to 23% more expensive.
- Clothing: Accessories and apparel have seen a 20% to 27% increase.
2. A “Fake Tree” Tax
If you prefer an artificial tree, the “Trump tax” is very real. Since about 90% of artificial trees are imported from China, prices have risen by 10% to 20%. Even the lights on the tree have been hit by tariffs, some as high as 67%. Families opting for real, U.S.-grown trees have largely been spared these specific increases.
3. The End of “Free” Shipping Perks
The removal of the de minimis exemption (which previously allowed goods under $800 to enter the U.S. duty-free) means that direct-from-factory orders—like those from Temu or Shein—now often come with surprise customs fees or brokerage charges ranging from $80 to $200 per package.
4. Impact on the Sleigh
- Consumer Sentiment: Nearly 72% of consumers say this is the most expensive holiday season they’ve ever experienced.
- Smaller Hauls: About 40% of households report they are buying fewer gifts this year to stay within budget.
- Retail Squeeze: Small toy stores are being hit hardest. Without the massive margins of big-box retailers, many have had to raise prices significantly or reduce their variety of stock.
Note: While the administration argues these tariffs will eventually bring manufacturing back to the U.S., experts note that complex supply chains for items like pre-lit trees or advanced electronics can’t be rebuilt domestically overnight.
Would you like me to look up some strategies for finding tariff-exempt gifts or domestic alternatives for the 2025 season?
