Which States Pay the Most in Tariffs? A Spending-Based Analysis

How can a state "pay" a federal tariff?

Legally, states don't pay tariffs at all. U.S. Customs and Border Protection collects duties from importers the moment goods clear a port of entry, and that revenue goes straight to the U.S. Treasury — no state government is involved. But tariffs don't stop at the border economically. Research from the New York Federal Reserve (Amiti, Redding, and Weinstein) found that Section 301 tariffs on Chinese imports were passed through to U.S. importers and, in large part, to consumers almost dollar for dollar, rather than absorbed by exporters.

Once that cost is embedded in retail prices, it lands on whoever buys the goods — and purchases are geographically uneven. A state with higher household spending on cars, electronics, appliances, and clothing effectively bears a larger aggregate dollar cost from the same national tariff schedule than a state that spends less overall. That's the question this analysis answers: not who writes the check to Customs, but whose spending generates the largest embedded tariff cost.

Our methodology: ranking states by tariff-exposed spending

The U.S. Bureau of Economic Analysis publishes Personal Consumption Expenditures (PCE) by State — the only federal dataset that estimates total household spending down to the state level. It doesn't break spending out by tariff-exposed category (electronics, apparel, vehicles) at the state level, so we use total per-capita PCE as a proxy: states that spend more overall tend to spend proportionally more across every category, including the imported durable and consumer goods that carry the highest tariff rates.

We scale each state's per-capita PCE against the national average, then apply that ratio to the Peterson Institute for International Economics' national estimate of $1,200–$2,600 in average annual household tariff cost:

Estimated state household tariff cost = (state per-capita PCE ÷ national per-capita PCE) × national average household tariff cost

What this estimate does and doesn't capture

This is a modeled proportional estimate, not an official government statistic — no agency publishes state-level tariff incidence. It assumes a state's overall spending level is a reasonable stand-in for its spending on tariff-exposed goods specifically. States with an unusually goods-heavy or services-heavy spending mix relative to their income level could over- or under-index compared to their true exposure.

Sources: U.S. Bureau of Economic Analysis, Personal Consumption Expenditures by State, 2023 (most recent state-level breakdown available). Peterson Institute for International Economics national household tariff cost estimate, $1,200–$2,600/year; midpoint of $1,900 used above. State figures are proportional estimates, not official tariff incidence statistics.

Which states pay the most in tariffs?

Massachusetts leads at an estimated $2,336 per household per year, followed closely by Connecticut, New Hampshire, California, New Jersey, and Colorado — all clustered between $2,150 and $2,340. These states share a common profile: high cost of living, dense high-income metro populations, and per-capita spending 13%–23% above the national average. None of them face a higher tariff rate than any other state — a 25% Section 301 duty on Chinese electronics is 25% everywhere. They simply buy more dollars' worth of tariff-exposed goods in total, so the same rate produces a bigger bill.

Which states pay the least in tariffs?

Mississippi sits at the opposite end, with per-capita PCE of $42,131 — about 25% below the national average of $56,202. Scaled against the national tariff cost range, that puts Mississippi households at an estimated $1,424 per year, roughly 64% lower than Massachusetts. Lower-spending states across the South and parts of the Mountain West follow a similar pattern: lower overall consumption means a smaller absolute dollar exposure to the same national tariff schedule, even though lower-income households typically spend a larger share of their income on goods overall.

Why do manufacturing states show up differently in trade data?

The spending-based ranking above answers one question: whose household budget absorbs the largest dollar cost from tariffs on the goods they buy. A completely different, production-side question is: whose local economy is most exposed to tariffs through the cost of imported inputs its manufacturers rely on. Pew Charitable Trusts reports that imports exceeded 20% of state GDP in Indiana, Kentucky, Michigan, and Tennessee in 2025 — states with deep manufacturing bases in autos, machinery, and fabricated metals that depend on imported steel, aluminum, and components. By contrast, imports made up less than 3% of state GDP in Hawaii, South Dakota, and Wyoming.

Source: Pew Charitable Trusts, "States Consider Effects of Rising Federal Tariffs" (October 2025), citing state-level import share of GDP.

A state like Michigan can have below-average household PCE while still facing significant economic exposure to tariffs — not because its residents spend heavily on imported consumer goods, but because its factories pay more for imported inputs, a cost that shows up as higher production costs, thinner margins, or layoffs rather than a bigger line item on a household's own credit card statement.

Spending-based vs. production-based: which number should you trust?

Neither ranking is more "correct" than the other — they answer different questions. The spending-based ranking in this article estimates whose grocery, electronics, and vehicle bills rise the most in dollar terms because of tariffs baked into retail prices. The production-based ranking from Pew and related research on manufacturing exposure estimates whose local jobs and industries are most at risk from higher input costs. A household in Boston and a factory worker in Indiana can both be meaningfully affected by the same tariff schedule, through entirely different channels.

Frequently asked questions about state tariff burden

Which states pay the most in tariffs?

Based on 2023 BEA per-capita consumption data scaled against the Peterson Institute's national tariff cost estimate, Massachusetts ($2,336/year), Connecticut ($2,202), New Hampshire ($2,201), California ($2,192), New Jersey ($2,157), and Colorado ($2,156) carry the highest estimated annual household tariff burden. Their per-capita spending runs 13%–23% above the national average, so the same national tariff rates translate into a larger dollar cost.

How can a state pay a federal tariff if tariffs are collected at the border?

No state government pays anything directly — U.S. Customs and Border Protection collects duties from importers, and the revenue goes to the U.S. Treasury. But most of that cost passes through to consumer prices, so "which state pays the most" really asks whose residents spend the most on tariff-exposed goods.

Which states pay the least in tariffs?

Mississippi has the lowest per-capita personal consumption expenditure at $42,131, about 25% below the $56,202 national average. Scaling the national tariff cost estimate by that ratio puts Mississippi households at an estimated $1,424 per year, roughly 64% below Massachusetts.

What is per-capita personal consumption expenditure and why use it here?

Per-capita PCE is a BEA measure of total household spending on goods and services divided by state population — the only federal dataset estimating consumer spending down to the state level. Since detailed category spending isn't published by state, it serves as a proxy for tariff-exposed spending overall.

Does living in a high-spending state mean I pay a higher tariff rate?

No. Tariff rates are set nationally by product category and don't vary by state. What varies is the total dollar amount of tariff-exposed goods a state's residents buy, which produces a larger aggregate cost in higher-spending states even though the rate itself is identical everywhere.

How much does the average American household pay in tariffs per year?

The Peterson Institute for International Economics estimates tariffs in effect in 2025–2026 cost the average U.S. household $1,200–$2,600 per year in higher prices, depending on income and spending mix. That national range is the baseline scaled by state spending in this analysis.

Are manufacturing-heavy states like Michigan and Indiana big tariff payers?

Not on the household-spending measure used here, but they rank highest on a separate production-side measure. Pew Charitable Trusts found imports exceeded 20% of state GDP in Indiana, Kentucky, Michigan, and Tennessee in 2025, driven by manufacturers' reliance on imported steel, aluminum, and components as inputs — an economic exposure distinct from consumer spending.

How reliable are state-level tariff cost estimates?

No government agency publishes an official state-by-state tariff incidence statistic, so figures like these are modeled estimates, not measurements. They assume overall per-capita spending reasonably approximates spending on tariff-exposed goods specifically, which holds only approximately across all 50 states.

Data sources: U.S. Bureau of Economic Analysis, Personal Consumption Expenditures by State. Household tariff cost range from the Peterson Institute for International Economics. Manufacturing import exposure from Pew Charitable Trusts. Tariff pass-through research from the Federal Reserve Bank of New York (Amiti, Redding, Weinstein). Model your own exposure with our Inflation Calculator.