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Trump’s new tariff comes into effect at lower than expected rate

Trump’s new tariff comes into effect at lower than expected rate
US President Donald speaks during a past function. PHOTO/https://www.facebook.com/WhiteHouse

US President Donald Trump’s new global tariffs have come into effect at 10 per cent despite a pledge to introduce them at a higher rate.

After the Supreme Court blocked many of his sweeping import taxes on Friday, the president said he would introduce a 10 per cent global rate. He then said that the rate would be 15 per cent.

However, according to official documents, the tariffs have been set at the lower rate from Tuesday, with no directive to increase the rate issued. The BBC has contacted the White House for comment.

“I think it simply adds to the chaos and mess,” said Carsten Brzeski, an analyst with investment bank ING, referring to the fast-changing tariffs and their effects on businesses.

“In terms of uncertainty, we’re back to where we were last year,” he told the BBC‘s Today programme, adding there was now a higher risk that the US’s trading partners would retaliate.

A view of the United States White House.PHOTO/@MELANIAJTRUMP/X

“The risk of a real, fully-fledged tariff war – trade war – escalation is clearly higher than last year,” he said.

An executive order signed by Trump on Friday said the temporary 10 per cent import duty was intended to “address fundamental international payments problems and continue the Administration’s work to rebalance our trade relationships to benefit American workers, farmers, and manufacturers”.

The administration is applying the levy under Section 122 of the 1974 Trade Act, which allows the president to impose the charge for 150 days without congressional approval.

The president has argued that tariffs are necessary to reduce America’s trade deficit – the amount by which imports exceed exports. But the deficit reached a fresh high last week, widening by 2.1 per cent compared to 2024 and hitting roughly Ksh158.4 trillion.

Brown and Gold Gavel on Brown Wooden Table: PHOTO/Pexels
Brown and Gold Gavel on Brown Wooden Table: PHOTO/Pexels

The US has already collected at least Ksh20.8 trillion in tariffs using the 1977 International Emergency Economic Powers Act (IEEPA), according to the most recent official data.

Trump has been highly critical of the Supreme Court’s decision, calling it “ridiculous, poorly written, and extraordinarily anti-American”.

In a 6-3 decision, justices on the highest US court found that the president had overstepped his powers when he introduced sweeping global tariffs last year using the IEEPA.

On Monday, Trump threatened to impose higher tariffs on countries that “play games” with recent trade deals, after the Supreme Court ruling.

His warning came as countries around the world said they were evaluating what tariffs and trade deals would stand following the decision.

United States President Donald Trump. PHOTO/@realDonaldTrump/X
United States President Donald Trump. PHOTO/@realDonaldTrump/X

The UK said no reciprocal action was “off the table” if the US did not honour its tariff deal with the UK, but added that “no one wants a trade war”.

The European Union said it would suspend its ratification of a deal struck over the summer.

“If we get worse conditions, then we need to react,” said the chair of the European Parliament’s delegations for relations with the US, Brando Benifei, adding that the EU had asked the US for clarity over the tariffs.

“I think you should demand respect,” he told the Today programme. “My plea is that all the countries in the world that do not like that we are being treated this way… try to work a bit together.”

India also said it would defer previously scheduled talks to finalise a recent agreement.

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