US President Donald Trump announced a global mutual tariff on trading partners on Wednesday (local time), calling it a “declaration of economic freedom”. A “baseline tariff” of 10 percent will apply to economies globally and will be effective on April 5 at 12:01, while the high rate will apply to those who will consider the White House “worst criminals” and kicks at 12:01 am on 9 April.
President Trump announced 26 percent on India and 34 percent of “concessional mutual tariff” on China. Speaking about India, he described Tariff as “very difficult” by New Delhi.
He said, “His Prime Minister (Narendra Modi) has left recently … he is a great friend of mine, but I told him that ‘you are a friend of mine, but you are not treating us properly’. India charges 52 percent fees from us, so we will charge them with that half – 26 percent,” he said.
Along with this, on Thursday, 25 percent tariffs will be applicable on automobiles coming to the US. Tariffs on some car parts will start May or later.
The US has introduced Tariff for “Make America Great Again”. President Trump said that it is time for America to be prosperous.
“This is one of the most important days … in American history; It is our announcement of economic freedom. Over the years, hard -working American citizens were forced to sit on the shore … but now it is our time to be prosperous.”
However, tariffs can increase prices for American consumers.
What are tariffs?
A tariff is tax imposed on goods imported from other countries. For example, if you live in America, buy sneakers made in China, the US government can add a tax to those sneakers. Companies bringing foreign goods in the country pay taxes or tariffs to the government.
Although you do not have to pay the tariff directly, the company can decide to increase the cost of the product to make up the tariff amount, meaning that you can pay more, as a consumer.
Tariffs make foreign products expensive and difficult to sell abroad. Foreign companies may have to cut prices and renounce prices to offset tariffs and maintain their market share in the respective country.
5 items are likely to be expensive for Americans
Cars
President Trump has announced 25 percent tariff on cars and parts. This means that the cost of cars manufactured in the US will increase with imported people in the country.
While the tariff aims to promote American manufacturing, the automobiles manufactured in American factories will still take a hit as taxes will also be levied on parts. All 10.2 million cars manufactured in American factories last year were mainly built with a significant number of parts imported from Canada and Mexico, stated by CNN.
Anderson Economic Group estimated the car prices to rise from $ 2,500 to $ 20,000. Vehicles are expected to be the most difficult, the group said, Audi, BMW, Jaguar-Land Rover, Mercedes-Benz, Genesis and Luxis include luxury sedans and SUVs produced by genesis and lexas.
clothes and shoes
The costumes and shoes sold in the US are manufactured outside the country, with the largest exporters with China, Vietnam and Bangladesh. The three countries are facing heavy mutual tariffs at 34 percent, 46 percent and 37 percent respectively.
Alcohol and coffee
President Trump has threatened 200 percent tariff on liquor from the European Union. This can make Spanish wine, French champagne, or German beer more expensive for Americans, although it is not clear whether it will be done.
America is the second leading importer in the world of coffee (both Arabica and Robusta Varieties). In 2023, according to the US Department of Agriculture, about 80 percent of US uncontrolled coffee imports came from Latin America ($ 4.8 billion), mainly from Brazil (35 percent) and Colombia (27 percent).
President Trump has imposed 10 percent mutual tariffs on both Brazil and Colombia.
avocados
Avocados thrives in Mexican climate. Mexico is the number one avocado supplier in the United States, with 89 percent of US avocado imports. The US Department of Agriculture has warned that Mexican can increase the cost of tariff avocado on fruits and vegetables. Related dishes like Guacamole can also be more expensive.
Fuel prices
Canada is America’s largest foreign supplier of crude oil. According to the most recent official trade data, 61% of oil imported into the US between January and November last year came from Canada as per a BBC report.
The US has introduced 10% tariff on Canadian energy.
There is no shortage of oil in the US, but its refineries are designed to be “heavy” – or coarse -crude oil, which mostly comes from Canada, with some Mexico, according to the BBC.
According to American fuel and petrochemical manufacturers, “Many refineries require heavy crude oil to maximize flexibility of gasoline, diesel and jet fuel production.”
