A announcement per day, the president of the United States, Donald Trump, who will apply a reciprocal tariff over all countries that tax the importation of American products. The measure, of which there are no precedents, supposes, in practice, to tax everyone. The effect, however, will not be the same in all cases: emerging economies, many of them Asians, and the European Union will suffer more than the rest. The Aviva Rate, in addition, fears of a large -scale commercial war and increase inflation in the North American country.
The movement is, in the words of the analysts of the consultant, a “global challenge” and an attempt to kill several birds of a shot: forcing the rest of the world to negotiate, increase tax collection and resurrect their vicious industry. And, above all, to stop a commercial deficit that, although it is not negative in itself – reflects, simply and plainly, the buoyant American internal consumption – Trump, faithful to his mercantilist ideology, has become one of his great black beasts. These are the main keys of the measure:
What are reciprocal tariffs? In the absence of concretion, and as its name indicates, it means that the United States will respond with levies to all tariffs that other countries apply on their products. If they already exist in both directions, Washington will match their levies to which they suffer their exports. Both this reciprocity and the creation of were two of the economic proposals of the Republican electoral campaign for the latest presidential elections.
What products does it affect? There is, by definition, a relationship of products subject to tax. Already approved specific tariffs on steel and aluminum, however, Trump’s priorities – with this and other encumbrances – now focus on three sectors: the car, the pharmacist and the semiconductor.
And what countries? Although the many commercial treaties signed in recent decades – with republican administrations and, above all, Democrats when the US still made free trade – have reduced taxes, practically all countries apply some tariff on US products.
Some, however, have more to fear than others. Since Trump – without any academic support – considers VAT a tariff, the EU has many visions to suffer the new Republican tool. If before you do not see to negotiate in the terms that the Republican wants.
economist of the Dutch Bank ING, sees “scarce justification” to the tool in the European case, given that its tariff regime towards the US is “relatively benign.” It does not count, of course, with the fixation of the magnate by VAT. The Great Zarpazo for the Old Continent, recalls in a recent report, can arrive in April, when the Commerce Department will publish its report on the reason for US commercial deficits Case in case.
Among the main affected by the measure are also India – whose prime minister, Narendra Modi, visits the White House this Thursday – or Brazil. Both, key members of the group of the, to which the Republican points so much.
“Emerging economies are those that have relatively higher tariffs towards the US, which makes them more vulnerable,” the economist recently wrote. It is logical that this is: industrial policies, tariffs through, were from countries like South Korea in the second half of the twentieth century. The measure, on the other hand, has less logic in an economy such as the American, which left behind the industrial splendor to enter an era of domain of services. It has not gone wrong: it is one of the rich countries that grows the most in recent years.
Is VAT really a tariff? No. Trump has registered on several occasions the value added tax – which although there are state -owned consumption taxes – to a tariff: “The VAT, which in the EU is in the clouds, is something similar,” said a few days ago . However, both concepts have nothing to do. While VAT tax practically all products and services, they are provided by who provides or provides them, the tariff applies only to imported goods.
What effect will it have in the US? If Trump’s movements finally enter into force, both in his first mandate and in the first measures of this second, they seem more aimed at hardening their negotiating position than to fulfill their threats – the measure would have a direct impact on inflation. American consumers will pay more for essential goods in their day to day, raising inflation and reducing the probability that the Federal Reserve will continue to lower interest rates. An increasingly remote option, with prices.
The countercara is the treasury. A tariff is still a tax: a form as valid as any other to increase fiscal collection and recall, even partially, US public accounts. How much will be collected, at this point already lack of details, an unknown.
