US President Donald Trump has signed a new order to double the tax on steel and aluminium brought into the country, from 25% to 50%. This is the second time since March that these import taxes have been increased. Trump said the higher taxes are meant to protect and strengthen the American steel industry. But many critics have warned that this move could hurt steel companies in other countries, lead to trade fights, and make things more expensive for American businesses that use these metals.
UK will be relieved of the 50% metal tariff
As per the official announcement made by Trump, the United Kingdom will not be facing the 50% tariffs on steel and aluminium. The US President stated that he has decided to give the UK a different treatment after both countries had reached a deal last month. The decision will offer temporary relief to the UK.
Steel and aluminium are utilised in almost everything from appliances used for vehicles and construction materials to canned goods. Trump’s announcement on Tuesday mentioned that the new tariff level would help ensure these imports and ‘’not to threaten to impair the national security ‘’ of the United States. The US President stated, ‘’In my judgement, the increased tariffs will more effectively counter foreign countries that continue to offload low-priced, excess steel and aluminium in the United States.’’
Industry reaction to Trump’s tariff hike
While Trump maintained that the move will ”further secure the steel industry in the US’’, the reactions to this decision have been mixed. David McCall, internal president of the United Steelworkers union, showed support for strategic tariff use but emphasised, “It’s essential that we also pursue wider reforms of our global trading system,” including partnerships with allies like Canada, as reported by the Associated Press.
‘’Tariffs alone will not increase US primary aluminium production. We also need consistent, predictable trade and tariff policy to plan for current and future investment, ‘’ Matt Meenan from the Aluminium Association cautioned as quoted by the Associated Press, but welcomed the focus. –
Economists also warned that the price surge on essential goods is expected to take place from groceries to construction materials. Meanwhile, steel prices in the US have already climbed 16% since January. As per the latest records, it has reached 4984 per metric ton in March, which is remarkably more in comparison to China and Europe.
Excluding the UK, most countries will be impacted by the 50% tariff rate. Countermeasures from other trade partners, including the European Union, are likely to occur. The EU has paused retaliatory measures but has cautioned that it will take action if trade talks with the US fail.
(With inputs from Associated Press)