Mr. Trump announced plans to increase tariffs with many countries

During a recent meeting with Japanese Prime Minister Shigeru Ishiba, US President Donald Trump revealed a plan to impose a “tit-for-tat” import tax with many other countries, according to Reuters. This means the new President wants to impose import tariffs on goods entering the US at the same level as the tariffs that trading partners are applying to US goods. Mr. Trump did not specify which countries would be affected, but said it would be a comprehensive effort to address the United States’ budget issues. The new US President said that tariffs on cars are still being considered in the context of reports that the White House is considering exemptions. For a long time, he has complained about the European Union (EU) imposing a 10% tax on imported cars, much higher than the 2.5% in the United States. He often criticizes Europe for not buying American cars but exporting millions of cars to the United States every year. In recent hearing sessions, US Commerce Secretary candidate Howard Lutnick expressed concern about India’s high tariffs. Meanwhile, US Trade Representative candidate Jamieson Greer complained about Brazil’s import duties and trade barriers. According to the data from the World Trade Organization (WTO), the average weighted tariff rate for the US is about 2.2%, compared to 12% for India, 6.7% for Brazil, and 2.7% for the EU. According to Reuters, Mr. Trump discussed this plan with Republican lawmakers during a budget meeting at the White House on February 6th. President Trump’s administration plans to use the revenue from increased import tariffs to extend the expiring corporate tax cuts, which will expire this year. Analysts previously forecasted that the extension could add trillions of USD to the U.S. national debt. Increased tariffs may offset some of those costs, although they only account for about 2% of annual revenue in recent years. Previously, Mr. Trump announced a 25% tariff on Canada and Mexico starting from February 4, but it has been postponed for a month. However, President Trump’s administration maintains the decision to impose a 10% tariff on Chinese goods from February 4th. Beijing retaliated immediately by imposing a 15% tariff on some American goods.