What are tariffs and why are Trump using them?

US President Donald Trump says he will declare tariffs on all steel and aluminum imports in the US, as he resumes America’s business relations with the world.

The move can have a special effect on the neighboring Canada, which is the largest supplier of aluminum for the US. Trump has threatened to introduce tariffs on a latter date on other Canadian products, as well as other products in Mexico.

He has already introduced 10% levy on all products entering China – which has responded with his own measures.

The US President says that these imports are required to help the US economy and “protect” the country from illegal immigration and flow of medicines. Economists say they can increase prices for Americans.

Tariffs are taxed on imported goods from other countries.

Companies importing goods from abroad pay tariffs to the US government.

Trump has introduced 10% tariff on all goods from China. Therefore, an additional $ 1 charge in a product of a price of $ 10.

The President originally stated that he would impose 25% tariffs on goods from Canada and Mexico, but later agreed to stop these after both countries agreed to promote border security.

Charging the percentage of the value of a product is the most common type of tariff. Another type imposes a certain figure on imports, which is also their value.

Trump is fulfilling a campaign promise to start imported duties against some close business parties of America.

They argue that tariffs will promote American manufacturing and protect jobs – for example in the US steel industry – as well as increasing tax revenue and increasing the economy.

He has also demanded to justify tariffs on metals – which he also introduced during his first term – as a national security issue.

Trump also says that he is using the tariff to “combat fantanel scores”, a powerful drug that causes tens of thousand overdose deaths in the US every year.

His administration says that chemicals used to bring medicines from China, while the Mexican gangs illegally supply it and there are Fantaneel Labs in Canada.

Canadian Prime Minister Justin Trudeau has said that less than 1% of Phentineil entering America comes from his country.

Together, China, Mexico and Canada calculated more than 40% imports in the US last year, making them some of Trump’s most valuable trade partners.

China

10% charge on all goods imported from China to America came into effect on 4 February.

Beijing retaliated with his own tariff which came into effect on 10 February. These include 15% tariffs on American coal and liquefied natural gas products, and 10% tariffs on crude oil, agricultural machinery and large engine cars.

China has repeatedly voiced its opposition to a new trade war that develops between the two countries during Trump’s first presidential post.

Canada

Trump stopped the proposed tariff of 25% on all items entering Canada for 30 days – which was scheduled to begin on February 4.

Canada also stopped its own retaliation of 25% in US imports ($ 107bn; £ 86bn) of $ 155bn Canadian dollars.

In exchange for Trump’s break, Canadian Prime Minister Justin Trudeau said that Canada was applied to “$ 1.3 billion border plan” to “new choppers, technology and personnel to add” to the border, as well as “Fantenal’s flow” Increase in resources to prevent “.

Most of the Border Security Scheme was already declared in December.

Trump said that the delay would allow America to see that “the final economic deal with Canada” could reach “.

Mexico

The proposed 25% tariffs against Mexico have also been delayed in a month, as measures have been taken by Mexico against American goods.

Mexico President Claudia Shinbam agreed to send 10,000 members of the National Guard on the US-Maxican border “to prevent” smuggling of drugs, especially to Fantanelle “.

President Shinbam said that the US had agreed to increase measures to prevent high -power American weapons smuggling in Mexico.

During Trump’s previous time, he implemented less restrictive tariffs on China. This time, tariffs apply to all goods from China.

If measures against goods from Mexico and Canada eventually proceed, many items are expected to be more expensive.

Car manufacturing can bear the brunt of the effects of tariffs.

Vehicle parts cross the US, Mexican and Canadian borders several times before a vehicle collects perfectly.

The average American car price can rise to $ 3,000 due to import taxes, Financial analyst TD Economics suggested.

Other items of Mexico that may be affected include fruits, vegetables, souls and beer.

Canadian accessories such as steel, wood, grains and potatoes will also be likely to get a pricier for American consumers.

Canadian energy will be targeted at 10% instead of 25%.

Trump earlier stated that the BBC was acting “out of the line”, without any more expansion, but suggested that a solution could be “work”.

The UK trading secretary, Jonathan Reynolds, said the UK should be excluded from the tariff as the UK exports more products than the US imports.

The UK exports pharmaceutical products, cars and scientific equipment to the US.

Trump has also said that he can impose tariffs on the European Union “very soon”, because “they take almost nothing (from America) and we take everything from them”.

Last year, the US had a $ 213BN trade deficit with the European Union – which Trump described as “torture”.

The European Union has said that it will “respond firmly” to any tariff. American companies Harley Davidson, who manufactures motorcycles, and whiskey distillery such as Jack Daniels have faced the European Union tariff.

Economists have warned that tariffs are likely to increase prices for American consumers.

For example, sellers can increase the price of items that they are importing if they are forced to pay high duties.

From 2018 to 2023, tariffs on imported washing machines, according to official data, before the tariff deadline ended, as per the official data, the price of laundry equipment saw an increase of 34%.

Some experts suggest that these new tariffs may increase comprehensive trade war and inflation.

Capital Economics has said that the annual rate of inflation can increase from 2.9% to 4% due to the newly declared tariff.