Concerns are rising over the potential impact of Donald Trump's proposed 'reciprocal tariffs' on UK businesses, particularly as VAT may now factor into trade calculations. This announcement threatens tariffs of 20% or more on British exports, with specific industries like automotive and pharmaceuticals expected to be significantly affected. The British Chambers of Commerce cautioned that Trump's approach broadens US trade retaliation, challenging previous assumptions about the UK's relative safety from tariffs. The introduction of VAT as a basis for tariffs complicates matters further, increasing uncertainty for exporters.
If reciprocal tariffs are applied on a VAT basis, European countries could face much higher tariffs, potentially impacting UK businesses exporting to the US significantly.
The British Chambers of Commerce has warned that key industries, including automotive, pharmaceuticals, and food and drink, could be significantly hit by these new measures.
Trump's administration is targeting not only traditional tariffs but also 'unfair or harmful acts, policies, or practices,' broadening the scope of US trade retaliation.
The introduction of VAT into tariff calculations raises fresh concerns about the potential impact on British exports, bringing increased uncertainty to existing trade relationships.
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