Donald Trump is imposing 10% “reciprocal tariffs” on all British goods being sold into the United States.
The charge exactly matches the tariff which the UK puts on imports from America.
The president also confirmed that foreign-made cars will have a 25% tariff slapped on them when they enter the US in a move which puts thousands of British jobs at risk.
Other countries being targeted include China, which will have a 34% tariff applied to its goods entering the US, Vietnam (46%), South Korea (25%), Thailand (36%) and Taiwan (32%).
Meanwhile, imports from the EU will have a tariff of 20% applied to them, Trump announced.
A Downing Street source said: “We don’t want any tariffs at all, but a lower levy than others vindicates our approach. It matters because the difference between 10% and 20% is thousands of jobs.
“We will keep negotiating, keep cool and keep calm. We want to negotiate a sustainable trade deal, and of course to get tariffs lowered. Tomorrow we will continue with that work.”
Trump unveiled the controversial measures at a White House press conference during which he said America “has been looted, pillaged, raped and plundered, near and far by friend and foe alike”.
“Our country and its taxpayers have been ripped off for more than 50 years, but it is not going to happen anymore,” Trump said.
He added: “April 2, 2025 will forever be remembered as the day American industry was reborn, the day America’s destiny was reclaimed, and the day that we began to make America wealthy again.”
Trump’s announcement is a major blow to the government, which has been trying to negotiate an economic deal with America which it was hoped would have spared the UK the worst of the tariffs.
The Office for Budget Responsibility has warned chancellor Rachel Reeves that a full-scale trade war would be deeply damaging to the UK economy, and wipe out the spare cash she had hoped to have.
Earlier on Wednesday, Keir Starmer said a trade war “is in nobody’s interests” as he refused to say whether the UK will hit back with new tariffs on American imports to the UK.
The PM said: “Our decisions will always be guided by our national interests, and that’s why we have prepared for all eventualities, and we will rule nothing out.”
Canada and the EU have take a different approach to the UK, confirming that they will retaliate with tariffs of their own on US imports.
Confederation of British Industry chief executive Rain Newton-Smith said: “Business has been clear: there are no winners in a trade war. Today’s announcements are deeply troubling for businesses and will have significant ramifications around the world.
“A cool and calm reaction from the UK government is the right response: UK firms need a measured and proportionate approach which avoids further escalation. Retaliation will only add to supply chain disruption, slow down investment, and stoke volatility in prices.”