The UK government is preparing for a huge round of new tariffs to go into effect on April 9. Countries around the world are preparing for significantly increased tariffs on imported goods. In answer, the UK Prime Minister would now seek radical industrial policies to shield British industry from the economic hurricane unleashed by recent US tariff measures in retaliation for industrial subsidies introduced in Britain.
The newly imposed tariffs strike a painful blow to UK car exports, imposing a heavy 25% duty on them. Similarly, they levy such charges on all steel and aluminum goods. In the opposite direction, a 10% tariff has been imposed on imports from the US. The current turbulence has forced UK businesses, such as Jaguar Land Rover, to reconsider where they do business. Jaguar Land Rover announced it would “pause” all shipments to the US while it navigates the complexities of the new trading terms.
In fact, in 2022 the UK exported almost £60 billion of goods to the US. Machinery, cars, and pharmaceuticals alone accounted for almost half of these exports. The UK government has a plan — to adjust to an evolving trade environment. They have started public discussions with other world leaders to seek mutually beneficial solutions that can help offset the effects of damaging US tariffs.
Sir Keir Starmer, leader of the opposition Labour Party, called for decisive intervention in these stormy waters. He stated, “Some people may feel uncomfortable about this – the idea the state should intervene directly to shape the market has often been derided.” He continued by saying, “We simply cannot cling on to old sentiments when the world is turning this fast.”
Starmer additionally stressed ideas to improve UK inc domestic competitiveness and guard against economic shocks from globalisation. “This week we will turbocharge plans that will improve our domestic competitiveness, so we’re less exposed to these kinds of global shocks,” he noted.
We welcome the Government’s attention to the detail. Though it has not yet closed the door on any further raising of taxes this Fall, it stresses that it fought against those increases in its own Spring Statement. The Prime Minister reiterated his commitment to using industrial policy to “shelter British business from the storm,” reflecting a proactive approach to safeguarding the UK economy amid rising international trade tensions.