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The European Commission said yesterday it would react “firmly and immediately” against tariff increases resulting from US President Donald Trump’s proposed “reciprocal” trade policy, which it labelled unjustified and a step in the wrong direction.
Trump has tasked his economics team with devising plans for tariffs on every country that imposes tariffs on US imports or subjects US companies to value-added or digital services taxes. Trump’s potential targets include China, Japan, South Korea and the European Union.
“The EU maintains some of the lowest tariffs in the world and sees no justification for increased US tariffs on its exports,” said a statement from the commission, which co-ordinates trade policy for the 27-nation European Union.
Imports
The EU executive said more than 70 per cent of imports enter the bloc tariff-free.
“The EU will react firmly and immediately against unjustified barriers to free and fair trade, including when tariffs are used to challenge legal and non-discriminatory policies,” the commission said in a statement.
European countries stress that value-added taxes they charge on imported goods, though typically higher than in the US, are not equivalent to tariffs since they apply equally to domestic producers.
A fact sheet from the White House on Thursday highlighted the difference between EU tariffs on car imports of 10pc and the US import duty of 2.5pc, as well as EU restrictions on imports of US shellfish.
It also criticised value-added tax, used across the bloc, as discriminatory and extraterritorial. And it took aim at regulatory requirements and digital services taxes on US companies, such as in France which imposes a 3pc tax on revenues from digital platforms and advertising, markets led by firms such as Google, Meta and Amazon.
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