What are Donald Trump’s tariffs, what is ‘liberation day’ and how does it all affect the UK?
If there is a word that has dominated Donald Trump’s second term, it’s tariffs.
Aluminium, steel, cars and champagne have all been in his firing line, while China, Canada and Mexico are the countries targeted with the heaviest costs.
Along the way, there have been threats, pauses and postponements.
So what are tariffs, what is in the pipeline – and what could all this mean for the UK?
What are tariffs and why is Trump threatening to use them?
Tariffs are taxes on goods imported into the US.
It is the importers buying the goods who pay the tariffs – therefore, American companies.
Ultimately, the intent is to protect US manufacturing and bolster jobs by making foreign-made products less attractive.
However, there is a knock-on effect: to compensate for tariffs, companies put up their prices, so customers end up paying more for goods.
Tariffs can also damage foreign countries as they make their products pricier and harder to sell.
In his second term, Mr Trump has frequently used them – or the threat of them – as a trade weapon.
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Trump’s tariffs: What can we expect?
They are a key part of Mr Trump’s efforts to reshape global trade relations, and he plans to impose a swathe of what he calls “reciprocal” taxes that would match tariffs levied by other nations.
Tariffs were also part of his playbook in his first term, when he imposed taxes on most goods coming from China and used them as a bargaining chip to force Canada and Mexico to renegotiate a North American trade pact.
On his first day back in office, the US president promised 25% tariffs on all products coming into the US from its nearest neighbours Mexico and Canada – ostensibly to force the countries to tackle illegal migration and fentanyl crossing the border.
What is liberation day?
Mr Trump has branded 2 April “liberation day”, when he could unveil the reciprocal tariffs on countries deemed to be giving the US a bad deal on trade.
The extent of potential tariffs and countries affected remains unclear, with Mr Trump at times sending mixed messages.
On 30 March, he said “all countries” could expect to be hit by tariffs.
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What is Trump’s ‘Liberation Day’?
Speaking from Air Force One, the US president rubbished a question from a reporter who asked whether it was true he was planning on targeting between 10 and 15 countries.
“Who told you 10-15 countries? You didn’t hear it from me,” he said.
When pressed on how many he was planning to hit, he said: “You’d start with all countries, let’s see what happens.”
Two days prior, he said he was open to carving out deals with countries seeking to avoid US tariffs, but that those agreements would be negotiated after 2 April.
He had previously said he “may give a lot of countries breaks, but it’s reciprocal”, adding: “We might be even nicer than that.”
How could the UK be affected?
The UK hopes an economic deal with the US will spare the country from some of the tariffs.
Sir Keir Starmer and Mr Trump have had “productive negotiations” towards a UK-US “economic prosperity deal”, Downing Street has said.
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‘Everything on table over US tariffs’
The two leaders discussed a possible deal in a phone call on Sunday and agreed negotiations will “continue at pace”, according to a statement released on Sunday 30 March.
The day before the so-called “liberation day”, Sir Keir told Sky News political editor Beth Rigby the UK was “working hard on an economic deal” with the US and said “rapid progress” has been made.
But, he admitted: “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.”
Sir Keir added: “We are discussing economic deals. We’re well advanced.
“These would normally take months or years, and in a matter of weeks, we’ve got well advanced in those discussions, so I think that a calm approach, a collected approach, not a knee-jerk approach, is what’s needed in the best interests of our country.”
Mr Trump has not explicitly said the UK is in his sights for further tariffs.
Data shows no great trade imbalances – the gap between what you import and export from a certain country – and UK figures show no trade deficit with the United States.
UK ministers have previously suggested this could be good news for avoiding new levies.
But the tariffs Mr Trump has already announced would have a big impact on the UK – particularly the car tariff.
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Business secretary hopes Trump tariffs will be ‘reversed in weeks or months’
Jonathan Reynolds, the business and trade secretary, earlier told Sky News he is “hopeful” the tariffs can be reversed soon.
But he warned: “The longer we don’t have a potential resolution, the more we will have to consider our own position in relation to [tariffs], precluding retaliatory tariffs.”
He added the government was taking a “calm-headed” approach in the hope a deal can be agreed, but said it is only “reasonable” that retaliatory tariffs are an option, echoing Sir Keir’s sentiments over the weekend.
What tariffs have already been announced?
Some tariffs have already come into effect, while Mr Trump has confirmed some that will come in on 2 April.
He has said a 25% tariff on all cars imported to the US will come into effect, with a similar tariff on car parts expected to follow in May.
This could prove even more complicated for American car makers, who source components from around the world even if the vehicle is made in the US.
But Mr Trump has insisted the move will “continue to spur growth”, pointing to plans from Hyundai – the South Korean car maker – to build a $5.8bn (£4.5bn) steel plant in Louisiana.
The tariff could have a huge impact on the UK’s car industry, including on manufacturers such as Jaguar Land Rover, Aston Martin and Rolls-Royce.
Official data shows the US is the UK car sector’s largest single market by country, accounting for £6.4bn worth of car exports in 2023 – 18.4% of the total.
Trump has also said he will place a 25% tariff on all imports from any country that buys oil or gas from Venezuela, which includes the US itself – in addition to imposing new tariffs on the South American country.
On 12 March, a 25% tariff on all steel and aluminium imports to the US came into effect, affecting UK products worth hundreds of millions of pounds.
The move came after he placed a 10% tax on all imports from China, which he later doubled to 20%.
He placed 25% tariffs on Mexico and Canada, but paused them for a month two days after they came into effect, meaning they are set to resume on 2 April.
The pause did not fully cover a tariff of 10% on Canadian energy products.
What has been the global response to tariffs?
There has widely been condemnation of the tariffs, especially from countries worst affected like Mexico and Canada.
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Canadian PM: ‘Tariffs are an attack’
Some have imposed, or threatened to impose, retaliatory tariffs.
China has already hit back with retaliatory tariffs covering a range of US goods, including a 15% tariff on coal and liquefied natural gas products, a 10% tariff on US crude oil and tariffs of up to 15% on key US farm exports.
Canada imposed tariffs of its own on US products, including a 25% reciprocal tariff on US steel and aluminium products and tariffs worth an estimated C$29.8bn (£16bn) on a wide range of US products including orange juice, peanut butter, alcohol, coffee and clothing.
Read more on tariffs:
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The European Union has said it will impose retaliatory tariffs on the US, but when they will come into force is unknown.
The European Commission initially threatened to impose “countermeasures” affecting €26bn (£21.9bn) of US goods from 1 April, but later delayed this until the middle of April.
The bloc said the delay was because it wanted “additional time for discussions” with the US after Mr Trump threatened a 200% tariff on EU alcohol – including wine and champagne – if the bloc imposed duties on US whiskey.
Any tariffs imposed by the bloc would not only impact US steel and aluminium products, but also textiles, home appliances, agricultural goods and whiskey.
Why tariffs could cost you – even if Trump spares UK
Even if no tariffs are put on all UK exports to the US, consumers globally will still be impacted by the wider trade war, particularly in the US.
Economists believe that tariffs will raise costs in the US, sparking a wave of inflation that will keep interest rates higher for longer. The US central bank, the Federal Reserve, is mandated to act to bring inflation down.
More expensive borrowing and costlier goods and services could bring about an economic downturn in the US and have knock-on effects in the UK.
Forecasts from the National Institute of Economic and Social Research (NIESR) predict lower UK economic growth due to higher global interest rates.
It estimated that UK GDP (a measure of everything produced in the economy) could be between 2.5% and 3% lower over five years and 0.7% lower this year.
The Centre for Inclusive Trade Policy thinktank said a 20% across-the-board tariff, impacting the UK, could lead to a £22bn reduction in the UK’s US exports, with the hardest-hit sectors including fishing and mining.
An MP has told Sky News she was attacked online by the Tate brothers after she participated in a debate in the House of Commons about violence against women.
The controversial duo, Andrew and Tristan Tate, are facing charges of rape and human trafficking in the UK – all of which they deny.
But they are still very active online, and according to Sorcha Eastwood, the MP for Lagan Valley, are targeting her.
In a document seen by Sky News, Tristan Tate has highlighted one of the MP’s tweets and writes in private correspondence: “MP, nice target, can we sue her?”
Sorcha Eastwood says at first she thought the replies were from parody accounts and not the Tate brothers.
Her original tweet was about Elon Musk, not the Tate brothers. The MP said Musk’s tweets should be looked at through a counter-extremism lens.
“I was really concerned, I was concerned because to me that is a direct attack for want of a better phrase on me serving my constituents.
“I couldn’t believe that they decided to pick this random Northern Irish MP. The fact that it wasn’t even about them. This is something I didn’t go looking for.
“I think from my perspective, it’s a very, very sinister attempt to shut down important voices in public life, political discourse.”
It was only when she started noticing an uptick in abuse from other accounts she realised she had encountered some of the brothers’ followers.
“I had rape threats. I had death threats. I had people saying I should be hung from a lamppost. I had people saying I should be chopped into liver. I also had people then who were like we’ll waste 15 minutes raping Sorcha Eastwood.”
A representative for the Tate brothers told Sky News that there was no targeted campaign against Sorcha Eastwood
A representative for the Tate brothers told Sky News that there was no targeted campaign against her.
They said: “Ms Eastwood has a distorted view regarding social media if she believes one is required to ‘invite or ask’ people to interact.
“Tristan Tate is entitled to his view in relation to her tweet regarding Elon Musk.”
The self-styled “misogynist influencer” Andrew Tate and his brother Tristan have both been charged with human trafficking, face allegations of trafficking minors, sexual intercourse with a minor and money laundering in Romania.
There is also a European arrest warrant for them as they are facing separate, unrelated charges of rape and human trafficking in the UK. They deny all charges.
Ms Eastwood now worries for others who don’t have a platform like her and who may not feel like they can speak out.
“If this is what has happened to me I have absolutely no doubt that this has happened to others where they have been attempted to be silenced.”
Keir Starmer has previously commented on the Tate brothers’ case in the Commons saying it is “a live issue”, but adding that “the principle is absolutely clear” in relation to whether the brothers should face justice.
Sorcha Eastwood says she wants to see the government do much more to protect against abuse online.
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Tate brothers deny wrongdoing
“I think ultimately the government has taken the wrong course on this. They need to step up.
“This should be an issue of national security as far as the radicalisation of young people online. It should be an issue in terms of the levels of misinformation, disinformation and the lack of trust that is had in our politics right across the UK and Europe.
“I want the government to help me, help every other person to crack down on this and get serious about it. And the only way they’ll be able to do that, is by hitting these tech companies in the only language which they understand, which is money and via robust legislation.”
A government spokesperson said: “Violence against women and girls is a scourge on our society which is why we have set out an unprecedented mission to halve these crimes within a decade.
“Tackling illegal abuse both online and offline is central to supporting victims and preventing harm in our communities and we will not hesitate to strengthen laws to deliver this mission.
“Last month, parts of the Online Safety Act came into force meaning companies must take action to protect users from illegal material including extreme sexual violence.
“Further protections from this summer will require platforms to protect children from harmful, misogynistic, and violent content.”
UK
‘It’s just nasty’: Birmingham residents ‘overwhelmed’ by foul stench and massive rats as bins strike rumbles on
In parts of Birmingham, the stench is overwhelming – enough to make you heave.
At a block of flats in Highgate, in Birmingham city centre, we find a mountain of bin liners full of rubbish spewing out of the cavernous bin store, which is normally locked.
Mickel comes out to speak to us, while all around bin liners lie open, with the contents for all to see, including used nappies and rotting food.
Mickel says they’ve had ‘foxes and rats, literally the size of cats’
Outside Mickel’s flat in Highgate, bin liners lie open, spewing out rubbish
We both find it hard to keep talking amid the awful smell.
“We’ve had foxes and rats, literally the size of cats, flies, it’s just nasty, something needs to be done,” he says.
Chris says the situation is ‘overwhelming’ as she’s ‘terrified of rats’
Around the corner, I meet Chris, in her dressing gown, popping the bins into her bin store beneath her flat before work.
She unlocks it, and although it isn’t bursting out on to the street yet, it is getting full.
She says the situation is “overwhelming” as she’s “terrified of rats”. But, even so, she has sympathy for the striking bin workers.
“It’s not an easy job; they must have a heart of gold to do that job,” she says.
“Pay them whatever they need, they deserve it.”
Striking bin workers at Lifford Lane tip, south of the city centre
There’s an awful smell coming from a mountain of bin liners outside Mickel’s flat in Highgate
At Lifford Lane tip, south of the city centre, Brigette has pulled up alongside picketing workers. The back seat of her car is full of rubbish.
She apologises for the terrible waft, mixed with air freshener.
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“It’s very pungent, isn’t it? Not nice,” she admits.
“It’s unfortunate, I have some sympathies for all the parties, but, equally, we have a duty of care to stay clean and tidy.”
She says she has her rubbish and that of her elderly aunt and plans to make weekly trips to the tip until a resolution in this pay dispute between the council and the Unite union is found.
UK
‘US is our closest ally’, Jonathan Reynolds says in reaction to Trump tariffs – but ‘nothing off the table’
The US is “our closest ally” but “nothing is off the table” in response to Donald Trump’s 10% tariffs on imports from the UK, the business secretary has said.
In a statement following the US president’s nearly hour-long address to the world, Business and Trade Secretary Jonathan Reynolds said: “We will always act in the best interests of UK businesses and consumers.
“That’s why, throughout the last few weeks, the government has been fully focused on negotiating an economic deal with the United States that strengthens our existing fair and balanced trading relationship.”
Follow the latest following Trump’s tariffs announcement
Mr Reynolds reiterated the statements from the prime minister and his cabinet over the past few days, saying the US is “our closest ally”, and the government’s approach is to “remain calm and committed to doing this deal, which we hope will mitigate the impact of what has been announced today”.
Business Secretary Jonathan Reynolds says “nothing is off the table” following the tariffs announcement. Pic: PA
But he continued: “We have a range of tools at our disposal, and we will not hesitate to act. We will continue to engage with UK businesses, including on their assessment of the impact of any further steps we take.
“Nobody wants a trade war, and our intention remains to secure a deal. But nothing is off the table, and the government will do everything necessary to defend the UK’s national interest.”
‘Get back round the negotiating table’, say Tories
The Conservative Party’s shadow business and trade secretary described the US president’s announcement as “disappointing news which will worry working families across the country”.
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Sky’s Ed Conway examines how economies across the world are impacted by tariffs
Andrew Griffith hit out at the government for having “failed to negotiate with President Trump’s team for too many months after the election, failed to keep our experienced top trade negotiator, and failed to get a deal to avoid the imposition of these tariffs by our closest trading partner”.
“The chancellor’s emergency budget of just a week ago with its inadequate headroom is now at risk, casting uncertainty about more taxes or spending cuts,” he continued. “Sadly, it is British businesses and workers who will pay the price for Labour’s failure.”
He called on ministers to “swallow their pride” and “get back round the negotiating table to agree a fair deal to protect jobs and consumers in both the UK and the US alike”.
Liberal Democrat leader Sir Ed Davey has reacted furiously to Mr Trump’s announcement of a “destructive trade war”, and called on the government to stand up against “Trump’s attempts to divide and rule”.
“The prime minister should bring our Commonwealth and European partners together in a coalition of the willing against Trump’s tariffs, using retaliatory tariffs where necessary and signing new trade deals with each other where possible.”
Speaking on Wednesday evening at a White House event entitled ‘Make America Wealthy Again’, the US president unleashed sweeping tariffs across the globe.
Mr Trump held up a chart detailing the worst offenders – which also showed the new tariffs the US would be imposing.
The UK’s rate of 10% was perhaps a shot across the bow over the 20% VAT rate, though the president’s suggested a 10% tariff imbalance between the two nations. Nonetheless, tariffs of 10% could directly reduce UK GDP by between 0.01% and 0.06%, according to Capital Economics.
A 25% duty on all car imports from around the world is also being imposed from midnight in the US – 5am on Thursday, UK time.
Read more:
World reacts to Trump’s tariff announcement
Tariffs will have consequences for globalisation, the US economy and geopolitics
Trump’s tariffs explained
The UK government had been hoping to negotiate an economic deal with the US in a bid to avoid the tariffs, but to no avail. The government says negotiations will continue.
The Confederation of British Industry said “negotiating stronger trading relationships with all like-minded partners will be foundational to any success”.
The business secretary is expected to make a statement in the House of Commons on Thursday, and we are also expecting to hear from the prime minister.
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