Thread by @DmitryOpines

1/ I'm not opposed to tariff cuts, but this article which pretends tariffs are levied on the RETAIL price of a good and that consumers will see a 10% saving at the shops from a 10% tariff cut.

Flatly misleading. Trade illiterate.

telegraph.co.uk/business/2020/…

2/ Let's take this bullshit.

A bag of 10 oranges cost 3.80 GBP, and have a 10% tariff.

Article contends eliminating that tariff will save you, plucky Brit 35p on every bag.

Fantastic.

Not at all true, but fantastic.

3/ For this, lets set aside that UK oranges currently primarily come from the European Union (tariff free) and developing countries (also tariff free).

Let's assume all oranges entering the UK were paying a 10% tariff.

But a 10% tariff on what?

4/ This is the current GBP monthly spot price for a kilogram of oranges from indexmundi.com/commodities/?c…

This is much closer to the price the tariff is levied on.

Now, the USDA lists the average weight of an orange at 131 grams, which means 10 oranges will weigh on average 1.31kg.

5/ So 1.31 x 0.43 x 10% = 0.05 GBP is what the actual tariff was likely closest to.

5 pence. Not 35.

This assuming Brexit adds no logistics and customs costs to orange delivery.

Is your local supermarket likely to pass on a 5 pence retailer saving to you, the consumer?

6/ I fervently hope that the authors of this telegraph piece, which include economic correspondents had nothing to do with designing and approving the graphic.

If you want to learn more about what tariff cuts mean in practice, I wrote a thing last year:

explaintrade.com/articles/2019/…

7/ Stop lying about my field.

Please.

/end