I do not understand:
1. UK Tariffs were 5.1 percent, now 1.8 percent
2. US Tariffs were 3.4 percent, now 10 percent
Are those UK tariffs on US goods and US Tariffs on UK goods?
And if fair trade with reciprocal tariffs is the goal, why is there any differential at all?
Zero tariffs on UK cars now coming into the US. That’s a pretty big deal for them.
1. Lower tariffs on the UK side reduces the cost to UK firms importing American goods. It’s a tax cut in effect. Less tax revenue for His Majesty’s Revenue and Customs (HMRC).
2. Higher tariffs on the USA side means the stuff Americans buy from the UK is getting more expensive because it’s going to be tariffed - ie taxed more by the federal government.
Sometimes the export is so profitable that the exporter will cover the cost of the tariff, in part if not fully.
If Trump wants $100 in tariffs for a tonne of British stuff, the Brits might pay half, the importer might pay half, and the consumer has to accept whatever price increase is passed on by the importer. It’ll depend on the demand, the profitability, and the margin.
So it’s a great deal. We get lower taxes in the UK, while your government gets your importers to pay a chump change amount off your deficit.
What’ll be really interesting is if HHS under RFK gets all that chemical crap out of your farming industry, like Australia already has done.
Finally you’ll have meat products the British will actually want to buy, without the chemicals... And you’ll have healthier meat in your diets.
Which is great news for me as like eating buffalo, bison, moose, elk, reindeer, and kangaroo. Deer is reasonably priced. But the others cost a bomb at the moment.
This could be a game changer for meaties, and a catastrophe for yoghurt knitting vegan tards.