Washington, D.C. — As small businesses head into the most important sales season of the year, new analysis from the Center for American Progress finds that the Trump administration’s economic agenda is piling new costs and uncertainty onto Main Street.
The holiday season accounts for at least one-quarter of annual revenue for nearly three-quarters of small and medium-sized retailers. Small businesses are contending with rising import costs due to tariffs, looming health care premium hikes, expanding paperwork burdens, and weakening consumer demand driven by higher prices.
“The Trump administration’s broad, costly, and frequently shifting policies threaten to undermine one of the strongest engines of the American economy,” said Michael Negron, senior fellow for economic opportunity at CAP and co-author of the analysis. “A season of opportunity for small businesses has turned into one of uncertainty.”
Key findings from CAP’s analysis and recent polling include:
- Tariffs are imposing major new monthly costs on small businesses. Small-business importers paid about $25,000 more per month in tariffs from April through September 2025 compared with the same period last year.
- Hundreds of thousands of small businesses are facing six-figure tariff burdens. Roughly 236,000 small-business importers paid an average of more than $151,000 each in additional tariffs, with small businesses with fewer than 50 employees paying more than $86,000 on average, from April to through September 2025 compared with the same period last year.
- Tariff costs have more than tripled and are still climbing. Small businesses paid an average of $36,000 per month in total tariffs from April to through September 2025—more than three times the amount paid during the same period in 2024—and paid roughly $42,600 in September alone, putting them on track to face more than $500,000 in tariff costs in 2026 if September levels persist.
- Small businesses are already cutting jobs amid rising costs. In November, businesses with fewer than 50 employees laid off 120,000 workers, the largest monthly total for small businesses in five years.
- Tariffs are forcing price hikes, delaying growth, and threatening survival. Recent polling finds that half of small-business owners have raised prices, one-fifth have delayed expansion plans, and 74 percent worry about surviving the next 12 months.
- Health care costs are set to deliver another financial hit. If enhanced Affordable Care Act premium tax credits expire, 4.4 million small-business owners and self-employed Americans will face an average $1,500 annual premium cost increase, with nearly half of small-business owners already citing rising health care costs as a major burden.
Read the analysis: “A Costly Lump of Coal: How Trump’s Tariffs Are Taxing Main Street This Holiday Season” by Michael Negron and Mimla Wardak
For more information or to speak with an expert, please contact Christian Unkenholz at [email protected].