Beset by market turmoil and political pressure, President Trump backed down Wednesday from his signature push to slap much-larger-than-expected “reciprocal” tariffs on imports from major trading partners such as Japan and the European Union, announcing a “90 day PAUSE” with a “substantially lowered” 10% rate for most countries instead.

But Trump pointedly denied any relief to China, the world’s second-largest economy.

In contrast, the president insisted on his Truth Social network that he would be raising “the Tariff charged to China by the United States of America to 125%, effective immediately” because of “the lack of respect that China has shown to the World’s Markets.”

“At some point, hopefully in the near future, China will realize that the days of ripping off the U.S.A., and other Countries, is no longer sustainable or acceptable,” Trump added.

Why is Trump singling out Beijing even as he spares the rest of the world (at least for now)? And how will 125% tariffs on Chinese imports — which China has countered tariffs of its own — affect you?

Here’s everything you need to know about the escalating trade war between Trump and Beijing.

Wait, the tariff on Chinese imports is 125%?!? Wasn’t it just, like, 10%?

If you’re having a hard time keeping up with Trump’s Chinese tariff rates, you’re not alone. A quick timeline:

Feb. 1: Trump signs an executive order imposing a 10% tariff on goods from China. It is a response, he says, to concerns about fentanyl smuggling. China threatens “countermeasures.”

Feb. 4: Trump’s 10% tariff on Chinese imports goes into effect. China responded with a series of retaliatory steps, including additional tariffs on products from the United States.

March 4: Trump imposes another 10% tariff on Chinese imports, raising the overall rate to 20%.

March 10: Beijing imposes tariffs on U.S. farm products, including an additional 15% on chicken and corn and 10% on soybeans and fruit.

April 2: Trump announces an additional 34% “reciprocal” levy on Chinese goods as part of his universal “Liberation Day” tariff plan, raising the overall rate to 54%.

April 4: China retaliates by announcing a matching 34% tariff on U.S. imports and barring 11 American companies from doing business in the country.

April 7: Trump threatens to counter with an additional 50% tariff on China, which would bring the overall rate to 104%.

April 9: Trump’s reciprocal tariffs go into effect — including a 104% tax on Chinese imports. China hits back by raising its retaliatory rate on U.S. imports to 84% — to which Trump responds with an astronomical new rate of 125% (even as he retreats from reciprocal tariffs for everyone else).

Whew............

Why go so big on China?

China is the primary source of fentanyl (and fentanyl ingredients) trafficked into the U.S. But this is about a lot more than fentanyl.

Trump has long insisted that America is being “ripped off” by foreign countries and that universal tariffs will level the proverbial playing field by incentivizing companies to retain American workers and ramp up U.S. manufacturing — all while funneling trillions of dollars in new revenue to the federal government.

He has also railed against trade deficits — how much more money we spend on another country’s goods and services than we earn from selling it ours — and vowed that tariffs will balance them out.

Trump allies — and indeed, most mainstream economists — agree that China is the worst “offender” on both fronts.

Contra Trump, trade imbalances between individual countries usually reflect the natural flow of goods and services more than unfair practices.

But even though China joined the World Trade Organization in 2001, and ostensibly agreed to the WTO’s rules, it has continued to heavily subsidize its domestic industries, making it hard for U.S. companies to compete. It has flooded the U.S. market with cheap goods, costing millions of American jobs. And it has pressured American companies to hand over their technology — or, according to the U.S., pilfered it outright.

In some ways, both countries have benefited from the arrangement. Now that China is one of the largest export markets for U.S. goods and services — and the U.S. is the top export market for China — it has meant lower prices for American consumers and higher profits for American corporations.

But Trump believes the status quo has become too costly for the U.S. — and that tariffs can restore some balance.

It’s less clear, though, why Trump’s chosen rate is 125%. The president’s initial 34% reciprocal tariff on China was calculated by taking America’s $300 billion annual trade deficit with Beijing and dividing it by the $439 billion in Chinese exports that flow into the U.S. each year — then misleadingly describing that number (68%) as China’s effective tariff rate on the U.S. and slashing it in half to be “kind,” as Trump put it.

Ultimately, the president arrived at 125% by just increasing his rate every time China retaliated with tariffs of its own.

According to Treasury Secretary Scott Bessent, Trump wants to send a message by ratcheting up pressure on China (while offering a reprieve to countries like Japan).

"Do not retaliate and you will be rewarded,” Bessent said Wednesday. “So every country in the world wants to come and negotiate: We are willing to hear you. We are going to go down to a 10% baseline tariff for them, and China will be raised to 125% due to their insistence on escalation."

How will Trump’s huge tariffs on Chinese imports affect prices?

Tariffs are import taxes paid by the company doing the importing — not by the foreign country (or foreign business) sending its goods to the U.S.

As a result, experts have found that most importers simply pass the added cost of tariffs on to U.S. consumers by jacking up their prices.

Meanwhile, any efforts to shift manufacturing to the U.S. will take a long time and cost a ton of money — which is another expense that consumers might have to shoulder, at least in the short term.

This doesn’t mean that Trump’s new 125% tax on Chinese imports will make your Chinese-assembled iPhone 125% more expensive; companies can decide whether to swallow the tariffs or raise their prices, and by how much.

But it does mean that there will be a lot of new upward pressure on prices. Consumer electronics could be hit hard, according to USA Today; even a 54% hike on the price of an iPhone would propel it past $2,000. About 30% of all U.S. textile imports come from China, which means that clothes could get a lot more expensive soon. And sticker shock might be even worse for furniture, bedding, lamps, toys, games, sports equipment and paint — more than 50% of which originates in China.

On the flip side, the U.S. exports $24.65 billion in agricultural goods to China each year — all of which will now be taxed at 84%, likely dampening demand and damaging the American farm industry.

Finally, on May 2, the so-called de minimis exemption for postal packages from China valued at less $800 — which were previously sent duty-free — will expire, and instead they will be taxed at 90% of their value (up to a maximum of $75 in May and $150 from then on).

All told, nearly half of all packages with de minimis exemptions are sent from China — and more than 30% come from the popular shopping sites Temu and Shein, according to Reuters. Expect fewer online deals on low-cost Chinese items.

Will Trump’s China tariffs be eased too?

Even as it projects defiance — and keeps retaliating — China has left the door open for negotiations.

In a white paper released Wednesday, China’s State Council said differences should be resolved “through dialogue and consultation,” adding that “we hope that the United States and China will meet each other halfway.”

Likewise, Trump said he would be willing to negotiate with Beijing.

“China also wants to make a deal, badly, but they don’t know how to get it started,” the president wrote Tuesday on Truth Social. “We are waiting for their call. It will happen!”

But White House officials believe they have the upper hand, and Trump won’t face as much political pressure to reverse course now that his global trade war has narrowed into a targeted trade spat with a single (domestically unpopular) country.

"I can tell you that this escalation is a loser for them,” Bessent said Wednesday. “Their exports to the U.S. are five times our exports to China. They can raise their tariffs, but so what?"

What happened the last time Trump battled Beijing over trade?

This is hardly Trump’s first trade tussle with China.

During his first four years in office, the president imposed significant tariffs on Chinese goods — including smartwatches, chemicals, bicycle helmets and motors — then continued to ratchet them up over the next 18 months until his administration signed a trade deal with Beijing in January 2020.

Ultimately, the percentage of total imports covered by tariffs more than doubled during Trump’s presidency — and his successor, President Joe Biden, kept many of Trump’s import duties in place.

“When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so,” Trump tweeted in 2018. “It will always be the best way to max out our economic power. We are right now taking in $billions in Tariffs.”

But according to a recent summary of the economic research conducted by the Harvard Business Review, Trump’s 2017-21 “tariffs didn’t lower the cost of imports from China” and “manufacturing jobs didn’t come back to the U.S.” — yet “U.S. consumers paid more on specific goods” and “sectors targeted by retaliatory tariffs,” especially agriculture, “took a hit.”