Recent legal challenges to President Trump’s trade tariffs have raised questions about their impact on the UK-US trade agreement.
While a New York court deemed the president’s blanket “reciprocal” import taxes unlawful, an appeals court subsequently allowed their continued collection pending a June 5th hearing. This development has limited immediate effects on the UK-US tariff pact.
The contested tariffs exclude those on automobiles (a major UK export), steel, and aluminum, which remain subject to 27.5% and 25% tariffs respectively – the standard rates for all countries. The ruling did not alter this.
While a UK-US deal aims to reduce car tariffs to 10% and eliminate those on steel and aluminum, its implementation is pending.
Jaguar Land Rover sources confirmed to the BBC the significant financial burden of these tariffs, contradicting industry body SMMT’s suggestion that existing US inventories could mitigate the impact.
The UK government stated its commitment to expediting the deal’s implementation, with Trade Secretary Jonathan Reynolds planning to advocate for swift action during a meeting with US representatives next week.
The ruling does block Trump’s 10% tariffs on other UK goods, such as salmon and whisky, leaving the future of this aspect of the agreement uncertain.
Any relief from halted tariffs may be short-lived; the White House intends to appeal the decision. Furthermore, alternative avenues exist for imposing tariffs—via other trade act provisions or congressional action.
Despite the UK’s publicized trade deal, its advantages over other nations remain questionable if the President’s ability to impose substantial tariffs is curtailed by the courts or legislature.
The most damaging consequence is the introduction of yet another unpredictable element into already volatile international trade relations, hindering business planning and investment.
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