President Donald Trump said on Tuesday that he plans to impose tariffs of around 25% on auto imports as well as semiconductors and pharmaceuticals shipped to the United States as early as April 2.
Trump recently enacted a 10% across-board-tariff on goods coming from China and 25% tariffs on all steel and aluminum imports.
For tariffs on semiconductor chips and drugs, he told reporters at his resort in Mar-a-Lago, Florida that he intended to eventually increase the rate even more.
“It’ll go substantially higher over a course of a year,” he said. But he added that he wanted to give time for potentially affected companies to bring their factories to America to avoid tariffs.
“We want to give them a little bit of a chance,” he said.
The revelation comes days after Trump ordered an investigation into other nations’ tax and tariff policies, paving the way for new reciprocal tariffs to take effect as soon as April 2, the day after the investigation is set to conclude, Howard Lutnick, Trump’s pick for Commerce Secretary said last week. Trump’s latest announcement underscores his push for a more “balanced” trade with foreign markets and to reshore strategic industries. He has long criticized what he deems as unfair foreign treatment of US exports.
The steep new tariffs could have far-reaching effects, extending beyond the specific industries where taxes are levied, and hurt consumers with higher prices and businesses with increased costs, economists and industry experts have warned.
Consumers are expected to feel most of the burn by the new import taxes on automobiles, as prices of cars could jump by thousands of dollars, experts have warned. Nearly half of vehicle sales in the US last year, including cars and light trucks, were imported from foreign countries.
Credit: CNN