With Donald Trump expected to outline the plans of ‘Liberation Day’ tariffs this evening, we want to know if you think the President’s hiked levies will derail our government’s economic plans. Have your say in our poll
Donald Trump is preparing to unveil details of his sweeping ‘Liberation Day’ tariffs on “all countries” which trade with the United States – and we want to hear your thoughts on today’s impending announcement. While it’s still unclear how much the tariffs will be, Chancellor Rachel Reeves yesterday warned the Cabinet they will hit the British economy.
Speaking to ministers, she said “global tariffs will have an impact on the UK as an open trading economy” but “securing a deal could mitigate some of those effects”. The plans intend to free the US from foreign goods, boost its domestic economy, and reduce trade imbalances.
The President has already confirmed an additional 25 percent levy on all car imports, with no deal yet agreed for the UK despite ongoing talks and the alleged ‘special relationship’. The measure is expected to hit British luxury car makers such as Rolls-Royce and Aston Martin.
It comes after an alarming report warned of an “extreme” hit to UK car plants, putting at least 25,000 jobs in the sector at risk. Pranesh Narayanan, research fellow at IPPR, said: “Trump’s tariffs have huge potential to completely destabilise the UK car manufacturing industry, affecting tens of thousands of jobs and putting the government’s growth plans at jeopardy.”
The levy is in addition to a set of tariffs scheduled to take effect on Wednesday, which may include a general 20 percent tax on UK products in response to the VAT rate. The Office for Budget Responsibility has cautioned that an increase in tariffs could wipe out Reeves’ near £10billion budgetary buffer as a result of lower tax receipts.
Economists warn that this could result in more tax rises and additional spending cuts. The tariffs could knock up to one percent off the size of the UK economy if there is a full-blown trade war with the UK retaliating to Mr Trump’s measures.
Conservative Party leader Kemi Badenoch accused Starmer of taking decisions that have left the UK economy “fragile just as we face global trade wars”. When asked if the Government would consider another budget if the UK is hit by tariffs from Trump, the Prime Minister’s official spokesman said: “We’ll obviously always take an approach that suits the British economy.
“We’ll have a budget in the autumn, and the OBR will obviously update the forecast at that point.” Starmer acknowledged that the UK was unlikely to be spared from the hits. He said: “Look, the likelihood is there will be tariffs. Nobody welcomes that, nobody wants a trade war. But I have to act in the national interest and that means all options have to remain on the table.”
The PM told MPs: “A trade war is in nobody’s interests, and the country deserves – and we will take – a calm and pragmatic approach.” He added: “That’s why constructive talks are progressing to agree a wider economic prosperity deal with the US. That’s why we’re working will all industries and sectors likely to be impacted.
“Our decisions will always be guided by our national interest, and that’s why we have prepared for all eventualities and we will rule nothing out.” Talks between the UK and US on avoiding tariffs remain ongoing, which is believed to focus on areas like AI and technology.
With the details expected to be announced at 9pm today and could apply from Thursday, we want to know if you’re worried Trump’s tariffs will derail our government’s economic plans. Vote in our poll HERE to have your say.
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