Details of the economic agreement between the United States and the United Kingdom have revealed a range of tariffs that affect British businesses.
It provides relief for UK tariffs on automobiles and steel in exchange for greater opportunities to make the U.S. agricultural sector enter the UK market.
Here are some key points of the transaction:
Steel tariffs
The United States has removed a 25% tariff rate on UK steel and aluminum exports, reducing trade barriers to these commodities to zero.
Under the plan, the UK will start working “quickly” to meet the requirements of the U.S. to ensure the supply chain of steel and aluminum products.
The deal would provide probation for the UK’s steel industry, which fell into a collapse just a few weeks ago.
U.S. tariffs on British cars have been reduced to 10%, among the top 100,000 vehicles exported to the U.S. The parts required for these cars will also receive special trade treatment.
Trump sets the tariff rate on car exports at 27.5%.
It is also understood that British automakers are very worried about the impact of unrestricted tariffs on their industry.
The benchmark tariffs on most commodities are still “reciprocal” tariffs and still exist.
Sir Kyle Starmer said the United States and the United Kingdom were “finishing more details to reduce trade barriers in other areas affected by tariffs”.
It is understood that negotiations are underway on the lower countdown tariffs, but there is no deadline for how long they may last.
Trump announced that the UK will also receive preferential treatment for any further tariffs on national security grounds, part of his motivation to protect his U.S. business.
Although British medicines are not subject to U.S. tariffs, Trump has pondered the idea of levied trade on the global import industry.
Prior to the results of the compliance investigation, the two countries have committed to “negotiating significant priority treatment outcomes on drugs and pharmaceutical ingredients”.
The UK has also pledged to work to “improve the overall environment” for pharmaceutical companies based there.
Both the US and UK agricultural sectors will gain new access to each other’s markets under this deal.
British beef farmers will be allowed to enter the U.S. market for the first time and join a select group of countries with similar arrangements.
British farmers received a tax-free quota of 13,000 metric tons.
In turn, American farmers will get a new opportunity to enter the UK: In some cases, UK tariffs on beef will be reduced to zero 125% from the quota of 13,000 tons.
However, Sir Kyle insists that the government adheres to its “red line” in agricultural standards.
In addition, the UK will remove 1.4 billion liters of ethanol to produce beer from the United States.
What are the non-tariff measures in the transaction?
Under the plan, the United States and the United Kingdom are committed to working on economic security by coordinating “non-market policies addressing third countries.”
They also promise to ensure cooperation by establishing already tight trade and investment security measures.
The U.S. and the UK have agreed to “ambitious” rules for negotiations on digital transactions, a move that could impact services such as online banking, financial technology, insurance or other industries that rely heavily on digital infrastructure.
In addition, both sides agreed to better cooperate in resolving tax revenues on imports and exports.
There is nothing in our deals to visit the NHS in the United States. There is no discount on the 2% tax discount for large U.S. tech companies, either.
“Just make it clear that there is nothing in the agreement. There is nothing in the agreement related to the online hazards or the Online Security Act. There is nothing in the agreement related to the digital service tax. There is nothing in the agreement related to the NHS.”
The Prime Minister appears to be violating his political rivals, and he calls on him to take a tougher stance with the president.
“I know people have been urging me to go away and go down with another relationship. We didn’t. We did the tough yard. We lived in the room. I’m really happy to be here and through their workforce to them, I think how important this deal is,” Sir Kyle said after this.
Lib Dem leader Sir Ed Davey is among those who call for a more muscular approach with Trump.
Under the terms of the agreement, both parties can cancel the transaction by issuing written notice to another country.
More details on how to review, change or terminate the transaction will be discussed during negotiations.
