U.S. Eases Tariffs Against the U.K.
Updated: Mar 11
Above are the flags of the two nations involved in tariff negotiations. The United Kingdom flag on the left and the United States of America flag on the right (source Reuters)
March 7th, 2021
The U.S. tariffs were on a wide range of goods including Scotch whiskey and cashmere which means that those goods will now be cheaper for U.S. citizens, according to CNN business. The United Kingdom suspended their tariffs against the United States back at the beginning of January as a gesture of good faith.
The trade conflict between the two nations began over illegal subsidies by the U.S. to Boeing and from the British to Airbus.
During the Trump Administration, the U.S. implemented $7.5 billion worth of tariffs on European goodssince October 2019. The World Trade Organization authorized the tariffs in favor of the U.S. after they investigated the illegal subsidies by European nations to Airbus.
In November 2020, the EU retaliated with a $4 billion tariff on U.S. goods following the WTO ruling of the U.S. providing illegal subsidies to Boeing.
Although the U.S. is halting U.K. tariffs, those against the EU are still in effect, but not for long. Biden’s nominee for U.S. Trade Representative, Katherine Tai, said in a statement last week during her senate confirmation hearing that she wants to figure out how to “land this particular plan because it has been going on for a very long time” and wants to stop the ongoing trade war.
The reversal of the tariffs will go into effect starting Monday, March 8th. The U.K. is welcoming the decision to suspend tariffs. Prime Minister Boris Johnson is ecstatic about the decision saying, “from Scotch Whisky distillers to Stilton-makers, businesses across the UK will benefit from the US decision today to suspend tariffs in this dispute”.
In a joint statement, the two nations said the tariff suspension will “ease the burden on industry and take a bold, joint step towards resolving the longest-running disputes at the World Trade Organization.” They wanted to “focus on negotiating a balanced settlement to the disputes” and push their attention to new competitors in the civil aviation market from non-market economies, such as China.