Why Taylor Swift’s ‘The Life of a Showgirl’ vinyl avoids tariffs

On Friday, 24-year-old Tayra McDaniels will scamper down the stairs of her East Village apartment building and pick up four preordered vinyl editions of Taylor Swift’s new album, “The Life of a Showgirl” — each a different color and with a different collectible cover. Then she’ll head over to Target to snag three more exclusive CDs and another vinyl, she said.

The haul will cost her more than $200. “I know it’s a lot of money,” she said. “But I don’t want to miss out.”

One point of reprieve in the price: McDaniels and other vinyl fans won’t have to worry about tariffs on their hauls.

Vinyl records, CDs and cassettes were spared from the Trump administration’s late-August rollback of the “de minimis” exemption. The exemption, which had allowed packages valued at less than $800 to be imported without tariffs, was designed to simplify customs for low-cost imports and reduce fees for both consumers and small retailers. Trump’s rollback of the exemption allowed tariffs to take effect on such shipments — but not on physical music.

A Cold War-era carveout known as the Berman Amendment to the International Emergency Economic Powers Act prevents presidents from regulating the flow of “informational materials,” a category that includes physical music, books and artwork.

“If vinyl had gotten tariffed, you could have possibly seen the price of a record going up to $40 and $50,” Berklee College of Music professor Ralph Jaccodine told CNBC. “So, this is welcome news for people buying physical music.”

The exemption, which is protecting one of the fastest-growing segments of the music industry, is also welcome on Wall Street.

Vinyl sales have roared back in the past decade, particularly during the pandemic, driven by younger buyers and an appetite for nostalgia. The PVC discs now account for nearly three-quarters of all U.S. physical music revenue — a nearly 20% jump since 2020, according to data from the Recording Industry Association of America.

“It is very encouraging and a bit of a relief that physical music formats have been classified as exempt to tariffs,” said Ryan Mitrovich, general manager of the Vinyl Alliance, a nonprofit promoting physical media that works with manufacturers, distributors and music labels. “However, we’re not really taking anything for granted here with the chaotic climate around trade disruptions.”

The sales boom has been lucrative for record labels such as Universal Music Group, or UMG, which works with Swift.

Her last album, “The Tortured Poets Department,” sold 3.49 million physical and digital copies, according to entertainment data company Luminate, driving a 9.6% jump in UMG’s second-quarter revenue in 2024 compared with the same period in 2023. Physical revenue, which includes vinyl, surged by 14.4% during the quarter.

Without a Swift album on shelves so far this year, UMG’s most recent earnings report, in July, showed a 4.5% uptick in revenue year over year, but physical revenue decreased by 12.4%. UMG shares fell 24% after the July earnings release.

Universal Music Group declined to comment.

The downturn could be short-lived. Estimates from Billboard predict that first-week vinyl sales of Swift’s new 12-track album, which debuts Friday, could top 1 million — breaking her own record of 859,000 for “The Tortured Poets Department.”

“Taylor Swift has unique ability to drive the market through her decisions of what and how to release music,” said Jaccodine, who has worked with artists such as Bruce Springsteen. “Swift’s release can and will likely cause a boom in the music business.”

“We support the tariffs because it helps U.S. manufacturing, and we want to be a part of the wave of making things in the USA,” Alex Cushing, co-founder and president of Dallas-based Hand Drawn Records, told CNBC.

Most vinyl is pressed overseas, industry experts said, with the largest manufacturer, GZ Media, based in the Czech Republic. GZ CEO Michal Štěrba said the company has made top-selling albums for artists such as Lady Gaga, Madonna and U2. On average, the company produces 1 in 4 records from plants around the globe, including ones in Nashville and Memphis, Tennessee, he added.

“Our goal is to keep production as close to the customer as possible, so that a record sold in the U.S. is also made in the U.S.,” Štěrba told CNBC.

If tariffs were imposed, Štěrba said, costs would get passed on to consumers. The Czech Republic is part of the European Union, which faces a 15% blanket tariffs on EU exports to the…