US President Donald Trump on Thursday said that his administration would start sending out letters to trading partners yesterday setting unilateral tariff rates, which he said countries would have to begin paying on Aug. 1
Trump told reporters that about 10 or 12 letters would go out yesterday, with additional letters coming over the next few days.
“I think by the ninth they’ll be fully covered,” Trump added, referring to a Wednesday next week deadline he initially set for countries to reach deals with the US to avoid higher import duties he has threatened.
Photo: Bloomberg
“They’ll range in value from maybe 60 or 70 percent tariffs to 10 and 20 percent tariffs,” he said.
The top tier of that range, if formalized, would be higher than any tariffs the president initially outlined during his “Liberation Day” rollout in early April. Those ranged from a 10 percent baseline tariff on most economies up to a maximum of 50 percent.
Trump did not elaborate on which countries would get the tariffs or whether that meant certain goods would be taxed at a higher rate than others.
Trump said that countries would “start to pay on August 1. The money will start going to come into the United States on August 1.”
Tariffs are typically paid by the importer, or an intermediary acting on the importer’s behalf, but it is often the end consumer that ultimately shoulders much of the cost.
The US president initially announced his higher so-called “reciprocal” tariffs on April 2, but paused those for 90 days to allow countries time to negotiate, putting in place a 10 percent rate during that interval.
So far, the Trump administration has announced deals with the UK and Vietnam, and agreed to a truce with China that saw the world’s two largest economies ease tit-for-tat tariffs.
Asked if more deals were on the way, Trump on Thursday responded that “we have a couple of other deals, but you know, my inclination is to send a letter out and say what tariffs they are going to be paying.”
Trump announced the Vietnam deal on Wednesday, saying that the US would place a 20 percent tariff on Vietnamese exports to the US and a 40 percent rate on goods deemed transshipped through the nation — a reference to the practice whereby components from China and possibly other nations are routed through third countries on their way to the US.
While the rates are lower than the 46 percent duty Trump imposed on Vietnam initially, they are higher than the universal 10 percent level, and many of the particulars of the deal are still unclear, with the White House yet to release a term sheet or publish any proclamation codifying the agreement.
Investors who have eagerly anticipated any deals between the US and trading partners were buoyed on Wednesday by the Vietnam announcement, which saw share prices of US manufacturers with facilities in the country rise.
Many major US trading partners, such as Japan, South Korea and the EU, are still working to finalize deals.
Trump has expressed optimism about reaching an agreement with India, but has spoken harshly about the prospects of an accord with Japan, casting Tokyo as a difficult negotiating partner.
He intensified his criticism this week, saying that Japan should be forced to “pay 30 percent, 35 percent or whatever the number is that we determine.”
Trump on Tuesday also said that he was not considering delaying next week’s deadline.
Asked about any potential extension of talks, US Secretary of the Treasury Scott Bessent on Thursday said that Trump would make the final call.
“We’re going to do what the president wants, and he’ll be the one to determine whether they’re negotiating in good faith,” Bessent said.
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