Trump says he'll impose huge new tariffs if elected in 2024

  • Former President Donald Trump is proposing a universal baseline tariff for imports into the US.

  • He also told Fox News he'd implement a "matching tax" on certain countries.

  • The ideas are part of his economic platform for his 2024 presidential campaign.

Donald Trump's return to the White House could bring about seismic changes to US trade policy, as the Republican frontrunner proposed setting up a universal tariff on imports entering the country.

He also proposed a "matching tax" on certain countries that would be equivalent to high tariffs on US products.

While Trump laid out the idea of a universal tariff months earlier, he appeared to get more specific last week.

"I think when companies come in and they dump their products in the United States, they should pay automatically, let's say a 10% tax," he told Fox News on Thursday. "That money would be used to pay off the debt. It's a massive amount of money."

He later added, "I do like the 10% for everybody."

Trump aides told the Washington Post that a tariff percentage has not yet been determined, with other sources saying that it's an ongoing discussion among his inner circle.

The former president also proposed what he called a "matching tax" on countries that impose high tariffs on US products, particularly if the foreign tariffs greatly exceed what Trump envisions for a US tariff.

"If they charge us, we charge that — very simple," Trump said on Fox News. "Now two things will happen, one of two things: either they'll wipe out the tax and so will we, or we'll take in a lot of money, and that's OK, too."

Although Trump said a universal US tariff would allow the government to reduce corporate taxes on American companies, it would raise costs for US firms that rely on essential imports as well as for consumers who likely would pay higher prices as companies pass on the tariff expenses.

Added to that, commentators warned it would worsen trade relations with the US, potentially fueling an international trade war.

"This would directly lead to a global trade war. We tried this approach — big tariffs on foreign goods — in the 1930s. It led to the global depression and the rise of fascism in response and thus to the Second World War. Bad idea," tweeted retired Admiral James Stavridis, who is now vice chair at the Carlyle Group.

Protectionist tendencies are no new thing to Trump, who raised tariffs on China during his White House tenure that targeted $200 billion worth of Chinese imports in 2018.

While the policy has been criticized for costing Americans billions and creating few new jobs, many of the tariffs have continued under the Biden administration.

In February, Trump floated the universal tariff idea as he began laying out an economic agenda for his campaign platform.

The tariff could rise if nations were to devalue their currency, Fox News reported. The plan represents the "linchpin of a new Strategic National Manufacturing Initiative," Trump said, according to Fox.

Read the original article on Business Insider