Trump's trade tariffs: a $ 250bn hold-up

Trade tariffs are a tax on importers, who must either absorb them into their margins or pass them on in their selling prices. The revenue collected depends on the tariff rate and the tax base. In the US, the effective trade tariff rate is currently around 10%, compared with 2.2% in January. The tax base swelled before Liberation Day and then shrank again. The US Treasury collected $ 90bn on tariffs in H1. Extrapolating from the current level, that would be $250bn over 2025, i.e. 0.8% of GDP. Under Donald Trump, the trade tariff narrative is in perpetual motion. The 9 July is the deadline for making “trade deals” or being punished with higher tariffs. Let's take a look at the negotiations.