Will Trump's Tariffs Raise Video Game And Console Prices? Here's What We Know

One of US President-elect Donald Trump's biggest talking points this election season has been around the subject of tariffs. Specifically, Trump has discussed tariff rates of 60% or more on products imported from China. Considering China is where video game consoles, accessories, and other video game and technology products are produced (at least in part--but these days, to a lesser degree), many are wondering how these proposed tariffs could impact the consumer.

In short, people want to know if video game consoles and games are about to get significantly more expensive, as some have predicted. This issue is even more top of mind considering the Switch 2 is expected to launch in 2025, with Rockstar's massively anticipated Grand Theft Auto VI also lined up for release next year.

There are no definitive answers as of yet. Some economists believe 60% tariffs are impossible. And Trump may not go forward with his plans as he's described them after he takes office in January, or at all. We spoke with analysts and collated other quotes and analysis about the potential impact of tariffs on video games to help paint a clearer picture of the situation in these early days.

"There's Going To Be A Lot More Tariffs"

What is a tariff? These are taxes placed on goods when they come across national borders. As USC Cornsife reminds us, tariffs first came to be in America not long after the Constitution was ratified more than two hundred years ago. Another key thing to know is that in a situation where import tariffs are implemented, like what's being discussed here, the end consumer typically carries the burden because companies importing the goods raise prices to avoid taking the hit, and pass that increased cost along to the consumer.

Tu Xinquan, who leads the University of International Business and Economics at the China Institute in Beijing, told The Associated Press that "no one" can face a 60% tariff. Should that happen, companies would "completely halt their trade with the US," he said.

During Trump's first term as US president, he implemented tariffs on hundreds of billions of dollars worth of products from China, and this in turn led to imports tapering off before rebounding again. Part of the plan was to help grow the US manufacturing industry, but experts say this did not happen. President Biden kept Trump's tariffs in place and added more, such as for steel and electric vehicles. Trump's proposed new tariff plan would be more wide-ranging and could potentially impact video games. Some in Washington and elsewhere believe Trump will be more bold and aggressive in his second term.

"There's going to be a lot more tariffs, I mean, he's pretty clear," Coalition for a Prosperous America CEO Michael Stumo told the AP. Former White House official Jen Harris, who worked under Biden, said a key concern with Trump's tariff proposal is that it could give companies an opportunity to "jack up prices."

Just recently, Trump said on a December 8 airing of NBC's Meet The Press that his planned new import taxes could end up costing consumers more at the register. "I can't guarantee anything. I can't guarantee tomorrow," he said in an interview when asked if consumers might pay more if his import taxes go into effect.

An Unwelcome Development For Video Games

The video game industry has faced stormy seasons of late, with major publishers cutting costs through game cancellations, layoffs, studio closures, and other ramp-downs. New tariffs arriving as the video game industry looks to rebound in 2025 could be problematic, experts warn.

"The potential roll out of US-based tariffs for games-related imports is an unwelcome development for the industry," Piers Harding-Rolls of Ampere Analysis told GameSpot. "It is particularly bad timing because of the headwinds the industry continues to face with cost-cutting ongoing in response to slower market growth, increasing R&D budgets and overexpansion during the pandemic."

Wedbush Securities analyst Michael Pachter told GameSpot that because Microsoft and Sony have US divisions, their game downloads--which represent a growing share of all game sales--would be tariff-free. In Nintendo's case, however, Pachter theorized that Nintendo could work with a US subsidiary. "Nintendo can get around this by having a US subsidiary license the rights to sell games in the US for $1 or so per unit, so they might pay tariffs on the $1, but the rest of their digital sales would be tariff-free," Pachter said.

For physical games, which have become a smaller piece of the overall sales mix but still a statistically significant element of it, Circana's Mat Piscatella said an import tax would prompt an increase in prices to consumers. In turn, Pisctalla said the most-likely scenario would be for publishers to raise digital game prices to be at parity. "Or the alternative would be to abandon physical. Either way, not great," Piscatella said. "Call me old school, but I'm more [of] a free-market guy. Going the isolationist/protectionist route doesn't generally work out all that well for normal people."

For new game hardware, meanwhile, Pachter said companies like Nintendo, Sony, and Microsoft can manufacture their systems in a no-tariff country or even the US. Analyst David Gibson, who covers Nintendo extensively for MST Financial, told Yahoo News that Nintendo got ahead of things years ago and is now producing around 50% of all Switch consoles outside of China, in places like Vietnam. That said, Gibson said he believes Switch prices--and presumably the cost of a Switch 2--could go up if Trump's import tax plans go ahead. Gibson estimated that Sony produces around 70% of PlayStation devices in China, with the rest being made in Japan and other regions. Microsoft, meanwhile, has been shifting its manufacturing operations beyond China for years already.

At $700, the PS5 Pro is already expensive.

Harding-Rolls said the most direct impact of potential import taxes would be the home console market. Harding-Rolls estimates that the US is the biggest console market worldwide, making up 45% of spending on games all up and 35% of console hardware sales volume. "Even if there is only a tariff applied to console hardware and accessories, this could disrupt the overall global console market as it would undermine US hardware sales, delay consumer adoption of new consoles, and even reduce consumer spending power on games and games services to offset these increases," he said.

Even without new import taxes in place, Harding-Rolls said he anticipates the Switch 2 to launch in Q2 2025 at a higher price point than the original Switch. Should any new foreign tariffs come to bear, that could be a significant disruptor for Nintendo's plans and might lead to an even higher price point for the highly anticipated new console, Harding-Rolls said.

"The effects would be devastating for game fans. China would not pay for this: the US consumer would." -- Serkan Toto

"For early adopters, a higher price at launch is unlikely to deter them [from] buying into the platform, but it could have a dampening effect in 2026 and onwards," he said. "While there has been some talk of more intensive adoption of cloud gaming services in response to potential hardware price increases, that’s not relevant to upcoming Switch/Switch 2 games made specifically for those platforms. That includes Nintendo’s own Switch/Switch 2 games."

Serkan Toto of Japanese consulting firm Kantan was blunt in his assessment of how new import taxes could affect the end consumer. "The effects would be devastating for game fans," he told Digital Trends. "China would not pay for this: the US consumer would."

$100 games?

The Consumer Technology Association (CTA) published a report in October that said new import taxes on technology products would increase prices across the board, but video game consoles specifically could see up to 40% increases to their sticker cost. With some quick and inexact math, that would make a PS5 cost $800 in the US instead of $500, with the price of games jumping from $70 to $112, Toto said. In reality, it might not work out this way for any number of reasons, though. This is all speculative and uncertain at the moment. That said, Walmart, Best Buy, and other major US retailers have said Trump's import tax proposals would likely lead to significant increases in price for all manner of goods.

Unquestionably one of the biggest game releases of 2025 is Grand Theft Auto VI, and some video game observers have already theorized that Take-Two could charge more than $70 for it. After all, the price of AAA game development has continued to climb in recent years without a significant change to the price of new games--something that former PlayStation executive Shawn Layden has railed on about over and over in interviews.

Will Microsoft, Sony, And Nintendo Fight The Tariffs Like They Did In 2019?

Trump's proposed tariffs may not go ahead as planned, or at all, of course. But if they do, it's possible video game products could be granted an exception. Some may recall how the CTA worked with Microsoft, Sony, and Nintendo during Trump's first presidency to push back against proposed tariffs--and they succeeded.

"In particular, tariffs on video game consoles would injure consumers, video game developers, retailers and console manufacturers; put thousands of high-value, rewarding US jobs at risk; and stifle innovation in our industry and beyond," the CTA's letter from 2019 said.

On November 27, the CTA released a statement from CEO Gary Shapiro, saying the trade taxes--if implemented--would be a "major inflation-causing tax on Americans and harmful to the US economy." The CTA estimated that the new tariffs, as proposed, would affect more than $350 billion's worth of US imports on technology products coming in from China, as well as Mexico and Canada. Given these concerns, it stands to reason that the CTA would attempt once again to lobby to either stop the tariffs or carve out exceptions like they did in 2019.

Joost van Dreunen, an adjunct professor at NYU's School of Business, wrote on his blog that he expects Microsoft, Sony, and Nintendo to once again band together to make a plea for an exemption, just like they successfully did years ago. Harding-Rolls hopes to see this, too.

"During Trump's previous administration, Microsoft, Sony, and Nintendo got together to successfully argue for an exemption to import tariffs. Let's hope that the gaming sector is spared once again," he said.

GameSpot has reached out to Nintendo, Microsoft, and Sony to find out if these companies plan to band together like they did in 2019 to fight the import taxes. At press time, none have responded.

Tariffs Leading To Changing Consumer Behavior

Another element at play with these proposed tariffs is how they could shake up the video game market in terms of how people play games. Van Dreunen argues that, with console prices potentially going up, consumers might seek out "hardware-independent" ways to play their favorite games. "These tariffs could fast-track the industry's shift toward cloud gaming, streaming services, and transmedia distribution, marking a classic transition from content innovation to distribution innovation in the pendulum cycle," he said.

For its part, Microsoft is already pushing into this area with Game Pass and its own cloud-gaming service, which essentially makes any internet-connected screen an Xbox. Microsoft is in the business of selling consoles, but with some predicting that the wider console market is not growing, Xbox is trying new strategies to reach people where they are. Van Dreunen said he thinks Sony might also look for lower-cost distribution alternatives, citing the surprising popularity of the PlayStation Portal device as an example. There are reports of Sony doing even more in this department with its own dedicated PS5 portable gaming device. "Even including the higher tariffs, [the PlayStation Portal] would remain a reasonable substitute compared to upgrading to the next version of the PlayStation," he said.

Lots Of Unknowns

Whether or not any of Trump's plans come to fruition as he laid them out or at all is an open question. Even if he does plan to press ahead with his new import taxes as proposed, he could face scrutiny and pushback from legislators and the public. The AP reported that House Democrats have already compiled legislation that seeks to take away any president's ability to introduce new tariffs on their own. This was understood to be a symbolic effort considering the Republicans will hold control of the House and Senate under Trump. Suzan DelBene, a Democrat from Washington, said no Republican or Democrat president should have the power to "indiscriminately raise costs on the American people through tariffs." We'll soon find out if Trump does just that.

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