President Donald Trump on Wednesday announced sweeping new tariffs on imports from dozens of nations, escalating a global economic conflict and triggering warnings of inflation, trade retaliation, and political fallout. The tariffs include a 34% levy on Chinese imports and a 20% tax on goods from the European Union, along with a 10% baseline rate on all foreign products. The measures, which Trump framed as a response to an "economic emergency," are aimed at reducing the U.S. trade deficit and revitalizing domestic manufacturing.
"Taxpayers have been ripped off for more than 50 years," Trump said during a Rose Garden address. "But it is not going to happen anymore."
The tariffs will apply to nearly all trading partners, including key allies. Goods from Japan, South Korea, and Vietnam will face duties of 20%, 26%, and 46%, respectively. Imports from Taiwan will be taxed at 32%. The administration invoked the 1977 International Emergency Powers Act to bypass Congress and implement the tariffs, arguing the global trade structure has harmed U.S. economic interests.
Markets reacted sharply, with U.S. equity futures sliding and global stocks extending losses. Olu Sonola, head of U.S. economic research at Fitch Ratings, estimated that the average U.S. tariff rate will surge to 22%, up from 2.5% in 2024. "Many countries will likely end up in a recession," Sonola said. "You can throw most forecasts out the door, if this tariff rate stays on for an extended period of time."
The White House expects the tariffs to generate hundreds of billions in new revenue. The baseline 10% tariff takes effect Saturday, while the elevated rates will begin on April 9. Aides say the higher tariffs were calculated based on trade imbalances, then halved to reach a "reciprocal" rate.
The administration also plans to phase out existing exemptions on imports valued under $800 from China and other countries, pending internal reviews. The 25% tariffs on auto imports, steel, aluminum, and goods from Canada and Mexico will remain in place. Future duties are expected on pharmaceuticals, lumber, copper, and semiconductors.
World leaders responded with alarm. Canadian Prime Minister Mark Carney warned that the tariffs would "fundamentally change the international trading system," pledging retaliatory action. Spanish Prime Minister Pedro Sánchez vowed to "respond decisively," while Italian Prime Minister Giorgia Meloni, a Trump ally, said the measures were "wrong" and urged negotiations to avoid a trade war.
UK Prime Minister Keir Starmer issued a statement that the British government would adopt a "calm and pragmatic approach," declining to impose retaliatory measures for now. Australian Prime Minister Anthony Albanese said the tariffs were "not the act of a friend" and had "no basis in logic."
Chinese officials warned that "protectionism leads nowhere," and trade wars benefit no one. In response to the heightened tariffs, many nations began outlining plans for reciprocal taxes or economic countermeasures.
Domestic businesses expressed concern about the ripple effects. Basic Fun CEO Jay Foreman, whose company produces Tonka trucks and Care Bears, said Trump's tariffs will force a price hike. "There is no other way," Foreman said. The Tonka Mighty Dump Truck will likely rise from $29.99 to as much as $45.
Trump's move could challenge his political standing. A recent Quinnipiac poll showed waning consumer sentiment. Critics, including Rep. Suzan DelBene (D., Wash.), said, "This is a massive tax increase on American families, and it's without a vote in Congress."
House Speaker Mike Johnson (R., La.) said, "It may be rocky in the beginning. But I think that this will make sense for Americans."
