Trump’s proposed tariff could cause a major problem for Ivanka’s $100 million business

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Donald and Ivanka Trump at a ribbon cutting ceremony at the Trump International Hotel in Washington, DC.
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REUTERS/Gary Cameron

If President-elect Donald Trump follows through with his plan to make it “a very expensive mistake” for US companies to manufacture goods overseas, it could put his own daughter’s business in a bind.

Ivanka Trump’s $100 million apparel line is produced primarily in China and Vietnam through a licensing deal with G-III Apparel Group Inc., Bloomberg reported.

The deal allows Ivanka’s company to cut costs by outsourcing manufacturing jobs overseas. It’s the type of business setup that President-elect Trump condemned throughout his campaign and continues to rail against.

“Any business that leaves our country for another country, fires its employees, builds a new factory or plant in the other country, and then thinks it will sell its product back into the US, without retribution or consequence, is WRONG!” Trump wrote in a series of tweets early Sunday morning.

In his tweets, Trump promised there would soon be a 35% tax on US companies selling products in the US that were manufactured in other countries.

Throughout the campaign, both Ivanka and her father were criticized for the hypocrisy of condemning companies that manufacture products outside the US while their companies were said to do the same.

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Donald and Ivanka at the Republican National Convention in July.
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Rick Wilking/Reuters

Nearly all Trump-branded and Ivanka Trump-branded merchandise was not made in the US, according to a PBS column by the economist Robert Lawrence. Not one of the 838 Ivanka Trump products advertised on Trump.com was made exclusively in the US, with 628 labeled as imported and 354 made specifically in China, according to the column.

Ivanka’s brand relies on various licensing contracts, such as her deal with G-III.

A tariff on products manufactured outside the country could increase production costs, making it more difficult for Ivanka to sell dresses at retailers like Nordstrom and Macy’s without raising prices. Bloomberg reported that by some estimates, the tariff could as much as double the cost of some retail items.

Ivanka did not respond to Business Insider’s request for comment.

The president-elect has said he would hand over the Trump Organization to his three eldest children – Donald Jr., Ivanka, and Eric – but he hasn’t elaborated on how the new management structure would alleviate concerns about the family’s potential conflicts on interest around the world.

Trump said last week he would be “leaving my great business in total in order to fully focus on running the country.”

But the ties between the Trump family’s business and politics run deep.

Since Election Day, Ivanka has sat in on her father’s meetings with world leaders, including with Japan’s prime minister, Shinzo Abe. At the same time, Ivanka’s company was putting the finishing touches on a new licensing deal with the Japanese apparel company Sanei International that the companies have been working on for the past two years, The New York Times reported. Sanei’s largest shareholder is the Development Bank of Japan, which is owned solely by the Japanese government.