When a tariff is applied to a foreign import, the tax burden (or incidence) is most often shared between the foreign producer and the domestic consumer, based on the relative price elasticity of the producers and the consumers.
The tariff is directly paid by the producer who is exporting the good. But the supply of the good also decreases due to the tariff which results in a higher price faced by consumers. In this way, domestic consumers are contributing to payment of the tariff. Unless the demand for the product is perfectly inelastic (vertical), the increase in price will be less than the tariff per unit, meaning, some of the tariff will be paid by the seller having to accept a lower price for its product.
The effect of the tariff on the welfare of the domestic consumer is negative. The consumer will face a higher price in the market, and fewer total consumers will end up purchasing the good, resulting in a decrease in consumer surplus.
