THE UK government is unwavering in its efforts to avert a full-scale “trade war” with the United States, following the announcement of sweeping new tariffs by President Donald Trump, which have sent shockwaves through the global economy. These fresh levies will impose a 10% tariff on all UK imports, with a steeper 20% on goods from the European Union, further complicating the UK’s delicate post-Brexit economic landscape.
For weeks, UK officials have been in intense negotiations with the US, striving to secure a deal that would mitigate the full impact of these tariffs—tariffs that have already rattled countries like Canada and China. A senior Downing Street source pointed out that the UK’s relatively lower tariff rates are a significant win, with the difference between a 10% and 20% levy potentially saving thousands of jobs.
Business Secretary Jonathan Reynolds has made it clear that the government remains laser-focused on reaching a fair and balanced trade deal with the US, one that strengthens the existing economic relationship while ensuring the UK’s interests are defended. “We have a range of tools at our disposal and will not hesitate to act,” Reynolds asserted, emphasising the government’s commitment to protecting the UK’s national interests.
With trade tensions rising, the UK government’s priority is clear: to avoid a destructive trade war at all costs. “Nobody wants a trade war, and our aim is to reach a deal that secures long-term stability for both sides,” Reynolds added. “However, let me make it clear—nothing is off the table in our efforts to defend the UK’s interests.”
President Trump’s decision to impose blanket tariffs on imports—from the UK’s goods to those of other nations—marks a dramatic departure from decades of American free trade policy. The tariffs, which are framed as punitive measures against the “worst offenders” in global trade, could have far-reaching consequences. Analysts have warned that these tariffs will likely lead to higher prices for US consumers, while slowing global growth.
In the worst-case scenario, the UK’s official forecasters predict that a full-blown trade war could cut UK economic growth by 1%—an economic hit that would wipe out Chancellor Rachel Reeves’ £9.9bn of fiscal leeway, undermining efforts to stabilise the economy.
However, a Downing Street insider remained optimistic, saying, “We don’t want any tariffs, but the lower levy on the UK compared to other nations vindicates our approach. This difference matters—it’s the difference between saving thousands of jobs and facing an uncertain future.” The UK government remains focused on securing a sustainable trade deal, with further talks scheduled to take place on Thursday with affected businesses.
Reynolds has previously stressed that the UK is in the “best possible position” of any nation to negotiate a reversal of these tariffs, thanks to weeks of close diplomatic engagement with the Trump administration. Lord Mandelson, the UK’s ambassador to the US, has been in regular contact with senior White House officials, including Vice President JD Vance and President Trump’s chief of staff, Susie Wiles, to further these discussions.
Prime Minister Sir Keir Starmer has made it clear that while all options are on the table in response to the tariffs, the government is not seeking to escalate tensions with retaliatory measures. “We’re committed to a fair deal, but we are also prepared to defend the UK’s national interest against unjust tariffs,” Starmer remarked.
Though some politicians, including Conservative shadow trade secretary Andrew Griffith, argue that the government’s stance is a direct result of Brexit, others are more cautious. The Liberal Democrats have called on the UK to consider retaliatory tariffs if necessary and to form a “coalition of the willing” with other countries to resist Trump’s protectionist agenda.
With the economic stakes so high, UK officials remain hopeful that talks with the US administration are progressing, despite the occasional confusion stemming from President Trump’s public statements, which have at times differed from the position of his negotiating team.
The trade deal the UK is pursuing goes far beyond tariffs, with discussions encompassing technology, services, and even contentious agricultural policies. The government’s focus on a comprehensive deal could include significant shifts in how the UK taxes tech giants like Amazon, with Chancellor Reeves suggesting that changes to the digital services tax, introduced in 2020, might be part of the broader negotiation package.
The UK’s motoring industry, already facing multiple challenges, was hit hardest by a new 25% tariff on all car imports to the US. The Society of Motor Manufacturers and Traders has called this new tariff “deeply disappointing,” with CEO Mike Hawes warning that manufacturers simply cannot absorb these costs, which will undoubtedly further strain an already struggling sector.
In this turbulent moment, the UK government is doing everything in its power to ensure that businesses and workers are protected from the economic fallout of an escalating trade conflict. While the path ahead remains uncertain, one thing is clear: the UK will not back down in its fight for a fair and balanced trade relationship with the US.
