Most conversations about tariffs treat them as a single national tax. A Federal Reserve study published September 3 shows the reality is far more uneven: states vary sharply in how much of their consumer spending flows through imported goods, which means the cost increase from higher tariffs lands with very different weight depending on where your customers and suppliers sit.

The mechanism runs through what economists call the consumption channel. When a tariff raises the price of an imported good, the cost falls on whoever buys that good in the domestic market, whether that is a household buying a finished product, a retailer marking up imported merchandise, or a manufacturer incorporating imported components. States whose residents and businesses rely more heavily on those goods absorb more of the total cost increase. States that buy more from domestic producers feel less of it, at least directly.

For a business that operates in a high-exposure state, this is not an abstraction. If your customers face a larger effective price increase on the basket of things they buy day to day, their real spending power compresses faster than the national average suggests. You may be watching national consumer spending data and concluding that demand is holding up, while the specific pool of buyers you depend on is already stretching thinner. The national number is not wrong, it is just not yours.