Trump Says He Will Increase His New Global Tariffs to 15%
US President Donald Trump has announced a significant shift in trade policy, stating that he will impose global tariffs of 15%. This decision comes in the wake of a Supreme Court ruling that invalidated his previous import taxes.
– New Tariff Implementation:
– On Friday, Trump proposed a 10% tariff on all goods entering the US.
– By Saturday, he declared an increase to 15%, leveraging a previously unused trade law that permits these tariffs to stand for about five months without congressional approval.
– Impact of Tariffs:
– The 10% tariffs were set to commence on February 24. It remains uncertain whether the newly proposed 15% would take effect at that time.
– This change affects countries like the UK and Australia, which had negotiated a deal based on the lower 10% tariff rate.
– Reason for the Increase:
– Trump criticized the Supreme Court’s decision, labeling it “ridiculous” and “extraordinarily anti-American.” The court’s 6-3 decision concluded that Trump had overstepped his authority by imposing extensive tariffs under the International Emergency Economic Powers Act (IEEPA), a law that has netted the US around $130 billion in tariffs to date.
– Reactions to the Tariff Increase:
– Business leaders have expressed mixed feelings. Drew Greenblatt, owner of a manufacturing plant, voiced disappointment, stating it obstructs advancement for low-income Americans seeking manufacturing jobs.
– Conversely, farmer John Boyd celebrated the ruling as a win against the president.
How Will Trump’s New Global Tariffs Work?
– Under the proposed 15% tariffs, US businesses will face higher import costs for most goods. Notably:
– Exemptions: Critical minerals, metals, and pharmaceuticals may be exempt from the new tariffs.
– Existing tariffs on steel, aluminum, and automotive parts remain intact, undisturbed by the Supreme Court ruling.
– Consequences for Trade Agreements:
– Countries like the UK, previously aligned with the US on trade, will now see the 15% tariff implemented instead of the negotiated rates.
– However, the UK government maintains that its essential trade relations with the US should continue as usual.
International Reactions to the Tariff Announcement
– Mixed Responses from Global Leaders:
– French President Emmanuel Macron stated that France would adjust its trade practices, aiming for reciprocal agreements rather than unilateral tariffs.
– German Chancellor Friedrich Merz emphasized the need for minimizing uncertainty around tariffs, asserting that it is detrimental to both European and US economies.
Next Steps
– The Supreme Court’s ruling has introduced a pathway for businesses and consumers to pursue refunds for previously collected tariffs, although the exact procedures remain unclear.
– Trump suggested that refunds would involve a lengthy legal process, and the US Chamber of Commerce highlighted the urgent need for swift reimbursements to support small businesses.
– Political Implications:
– Discussions around tariff refunds could potentially shape the landscape for the upcoming midterm elections. Senator John Kennedy warned that pushing for refunds might inadvertently favor Republican candidates.
In summary, Trump’s decision to increase global tariffs to 15% represents a pivotal moment in trade policy, emerging from recent judicial challenges and provoking mixed reactions from various sectors. The ramifications of this decision will unfold in the months to come, shaping both domestic and international economic landscapes.