Donald Trump has consistently emphasized that tariffs are forthcoming, a message that has remained steadfast throughout his presidency. However, the specifics regarding the tariffs—what they will apply to and when they will take effect—remain fluid, as import taxes have been rapidly implemented since his inauguration, making it difficult to track the full scope of his trade policy.
To date, Trump has already increased duties on Chinese imports, as well as on steel, aluminum, and certain goods from Canada and Mexico. Additionally, higher tariffs on automobiles are set to take effect this week. The next major development is expected to be the announcement of a more comprehensive tariff plan, which the administration has been formulating over the past several weeks.
Dubbed "Liberation Day" by the White House, the upcoming announcement is anticipated to shed light on these broader tariff measures. So, what can we expect to learn on Wednesday?
What is the magnitude of the tariffs?
While the White House has not specified the precise rate of the new tariffs, various potential figures have been discussed by analysts. During his campaign, Trump advocated for a universal 10% tariff on all imports to the United States, occasionally suggesting that this could escalate to 20%, or even as high as 60% on imports from China.
Upon assuming office, Trump introduced the concept of "reciprocal" tariffs, which would vary on a country-by-country basis. In his words, "very simply, it's if they charge us, we charge them," a stance he outlined in February just before directing officials to devise a plan to implement such tariffs.
Complicating matters, the White House has indicated that the recommendations will encompass not only tariff rates but also other policies that it deems disadvantageous to U.S. businesses, such as Value Added Tax (VAT) systems. This has prompted significant uncertainty, as businesses and political leaders scramble to understand how these new taxes might affect their products and how they will interact with existing tariffs, such as those on steel and aluminum, which have already been enacted by Trump.
For instance, European officials are bracing for a potential double-digit tariff on their exports, with Trump earlier this year suggesting a 25% import tax on goods from the European Union.
Which countries could be impacted?
Although the Trump administration has not yet confirmed which countries will be targeted, it has previewed the upcoming announcement as being extensive in nature. On Sunday, the president stated that the new tariffs could apply to "all countries," hinting at the possibility of a return to the across-the-board tariff policy he endorsed during his campaign. This revelation dashed the hopes of some nations, including the UK, that had hoped to remain unaffected. However, many countries are still hoping to negotiate specific deals to mitigate the impact.
The extent to which the tariffs will be uniformly applied or more selectively imposed remains unclear. Last month, U.S. Treasury Secretary Scott Bessent indicated that the administration's focus was on the "Dirty 15"—the 15% of countries responsible for the majority of trade with the U.S. that also impose tariffs or regulations that disadvantage American companies.
In preparation for crafting its recommendations, the Office of the U.S. Trade Representative identified countries of particular concern, including Argentina, Australia, Brazil, Canada, China, the European Union, India, Indonesia, Japan, South Korea, Malaysia, Mexico, Russia, Saudi Arabia, South Africa, Switzerland, Taiwan, Thailand, Turkey, the UK, and Vietnam.
Notably, Trump has reserved some of his harshest criticism for historical allies and major trading partners, such as Canada and the European Union. As he remarked last week, "Friends have, oftentimes, bee
n much worse than foes."
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