The furniture industry is caught in a storm of trade uncertainty, and small business owners across America are feeling the pressure. A 25% tariff on imported upholstered furniture, kitchen cabinets and vanities remains firmly in place heading into 2026, even after the Supreme Court struck down a major pillar of the Trump administration’s broader tariff strategy. For entrepreneurs running furniture shops, design studios and import operations, the question is no longer if costs will rise but how long they can hold on.
How the Furniture Tariffs Started
3 On August 22, 2025, President Trump announced plans to impose higher tariffs on furniture. On September 30, 2025, he issued a proclamation placing 25% tariffs on kitchen cabinets, bathroom vanities and upholstered furniture, effective October 14, 2025. 10 Trump justified the tariffs by invoking Section 232 of the Trade Expansion Act of 1962, a provision that allows the executive branch to levy import duties on goods that threaten national security. 7 He wrote on social media that his goal was to help revive U.S. furniture manufacturing in North Carolina. 10 Imported lumber was tariffed at 10%. Upholstered furniture was set at 25%, rising to 30% on January 1, 2026. Kitchen and bathroom cabinets were set at 25%, increasing to 50% on the same date.
But in a last minute move, 25President Trump signed a New Year’s Eve proclamation delaying the increased tariffs for a year, keeping the 25% rate in place but pushing back the 30% rate on upholstered furniture and the 50% rate on kitchen cabinets and vanities.
The 25% duty is not going away anytime soon. 17The tariff on certain kitchen cabinets, upholstered furniture and vanities did not increase on January 1, 2026. The current 25% tariff will remain in effect through 2026.
furniture tariffs impact small business owners in United States 2026
Why Small Furniture Businesses Are Hit the Hardest
The numbers tell a painful story. 21Alex Shuford, CEO of North Carolina-based manufacturer Rock House Farm, says his company’s tariff bill in 2024 was $300,000, but this year’s will be well over $3 million. 21“Next year, if this continues, we’ll be pushing $6 or $7 million,” he says.
11 Small businesses are feeling the impact most acutely while larger retailers have been taking market share.
Here is how the gap between big and small players is growing:
| Factor | Large Retailers | Small Businesses |
|---|---|---|
| Pricing Power | Can negotiate supplier concessions | Limited bargaining leverage |
| Sourcing Flexibility | Diversified global supply chains | Dependent on fewer suppliers |
| Cost Absorption | Wider margins to absorb tariffs | Thin margins, forced to pass costs on |
| Market Performance | RH, Wayfair growing sales | Many struggling or exiting |
11 RH, Williams-Sonoma and Wayfair have all grown sales and margins even as they faced higher import costs. RH saw sales grow almost 10%. Williams-Sonoma grew about 4%. Wayfair saw revenue grow 5.1% in fiscal 2025.
Meanwhile, the damage on the other end is devastating. 11American Signature Furniture, the parent company behind Value City Furniture, declared bankruptcy late last year after nearly 80 years in business. It began liquidation sales at its 89 remaining stores. Sales declined 27% between 2023 and 2025. Net operating losses ballooned from $18 million to $70 million, further exacerbated by new tariff policies, the company said in its filing.
“This is a very, very difficult time to manage your business. The No. 1 driver of the difficulty is unpredictability.” 11This sentiment, shared by an industry leader, captures the reality that tariffs and uncertainty are the latest blow to a furniture industry that has been struggling for four years.
What the Supreme Court Ruling Means for Furniture
29 On February 20, 2026, the Supreme Court held, in a 6-3 decision issued by Chief Justice Roberts, that the tariffs President Trump imposed under the International Emergency Economic Powers Act (IEEPA) are unlawful.
Many furniture business owners hoped the ruling would bring relief. It did not.
28 The Supreme Court decision does not impact Section 232 tariffs, including those on steel, aluminum, copper, upholstered furniture, kitchen cabinets and bathroom vanities. 30 The furniture industry found little relief from the ruling. Items like couches, kitchen cabinets, vanities and more were hit with higher tariffs under Section 232. The roughly 25% duties will remain in place.
The tariff threat is far from over. 30The furniture industry is already facing greater uncertainty, with the 25% tariff expected to rise to 50% in 2027, and broader pressures from higher interest rates and inflation.
Adding another layer, 29President Trump issued a proclamation under Section 122 imposing a 10% “temporary import surcharge” on products of all countries, effective February 24, 2026, for 150 days. 29He then announced on Truth Social that he would immediately increase the rate to 15%, the maximum tariff rate allowed under Section 122.
How Consumers Are Feeling the Price Squeeze
The costs are flowing downstream fast. 13American consumers are expected to pay more than half of the added costs from U.S. tariffs, according to a Goldman Sachs analysis.
7 Furniture prices have been outpacing inflation, with living room, kitchen and dining room furniture rising 4.6% in November from a year earlier, compared with a 2.7% annual increase in the overall Consumer Price Index.
Key consumer impacts at a glance:
- Higher sticker prices on sofas, dining sets and bedroom collections
- Less product variety as importers focus only on bestselling items
- Fewer discount deals as retailers protect shrinking margins
- Longer wait times for orders as companies pause to study evolving rules
12 Jason Miller, a supply chain management professor at Michigan State University, said the bigger impact will be on variety: “Consumers should expect less variety.” 19 More than three-quarters of consumers in the market for new furniture were aware of potential price impacts before the latest tariffs were announced, according to a survey by Furniture Today. About 22% plan to buy sooner to avoid hikes, while 30% said they might delay purchases.
What Furniture Business Owners Can Do Right Now
The industry is not sitting still. Smart operators are adapting with urgency.
6 Lovesac is executing a tariff mitigation plan that features price bumps, sourcing diversification and supplier concessions. Others are taking a different approach. 21 John Hart, who runs Texas-based design company Arteriors and imports 97% of the furniture he sells, has been looking to move operations out of Southeast Asia. But navigating that switch means dealing with a new set of rules and regulations.
Practical steps business owners are taking:
- Reviewing country-of-origin documentation for every shipment
- Building tariff-adjustment clauses into new purchase orders
- Stocking up on bestselling inventory before potential rate hikes in 2027
- Exploring domestic suppliers for key materials and components
- Watching for IEEPA tariff refund eligibility through the Court of International Trade
22 The Home Furnishings Association says this tariff delay creates a valuable window for the industry to share real-world impacts on business operations, engage decision-makers proactively and advocate for long-term mitigation strategies, not just temporary fixes.
For every furniture entrepreneur in America, this is a moment of reckoning. Whether you run a two-person cabinet shop or manage a chain of retail showrooms, the ground beneath the industry keeps shifting. Tariffs have already claimed longtime businesses, squeezed household budgets and forced painful choices on pricing and sourcing. The resilience of this industry will be tested again when the delayed rate hikes come up for review in January 2027. Now is the time to speak up, plan ahead and support one another through a period that many in the trade are calling the toughest in a generation. Share your story with your representatives, connect with industry groups, and let your voice be heard.
