US President Donald Trump is set to impose extensive new tariffs on imports by 2 April, escalating his ongoing trade war in what he has termed “Liberation Day,” the local media reported.
Since returning to office, Trump has already raised tariffs on an estimated $800 billion worth of imports, targeting key trade partners such as China, Mexico and Canada.
The aggressive measures have rattled global markets, triggered volatility on Wall Street, and sparked fears of a potential recession.
Despite economic concerns, senior White House officials are now preparing to expand tariffs to cover “trillions” of dollars in imports, alarming economists and unsettling congressional Republicans.
Trump has framed the policy as a move to bring manufacturing back to the United States and force economic concessions from foreign governments.
Speaking on Monday, he defended the plan, saying the US had been exploited by unfair trade practices.
“It’s a liberation day for our country because we’re going to be getting back a lot of the wealth that we so foolishly gave up to other countries, including friend and foe,” Trump said.
Reciprocal Tariffs Plan
Trump’s strategy, known as the “reciprocal tariff” plan, seeks to impose tariffs on foreign goods equal to the duties that other countries levy on US products.
“If India, China, or any other country hits us with a 100 or 200 per cent tariff on American-made goods, we will hit them with the same exact tariff,” Trump said in a campaign video. “In other words, 100 per cent is 100 per cent. If they charge us, we charge them—an eye for an eye, a tariff for a tariff.”
While the plan resonates with Trump’s supporters, trade experts warn that most developed economies already have similar tariff rates.
According to World Trade Organisation data, the average US tariff stands at 2.2 per cent, compared with 1.9 per cent in Japan and 2.7 per cent in the European Union.
Raising US tariffs to match foreign rates could push import duties to an average of 20 per cent, levels not seen since the 1930s, warned Edward Gresser, a trade policy analyst.
The policy’s potential consequences have sparked internal debate within the administration. Vice President JD Vance, Commerce Secretary Howard Lutnick, White House trade adviser Peter Navarro, and Treasury Secretary Scott Bessent are in discussions on how to implement Trump’s vision while minimising economic fallout, the local media reported.
“The last two months have already hurt American businesses and consumers, but the 2 April deadline could make all of that look like a tempest in a teapot,” said Joseph Politano, an economic policy analyst at Apricitas Economics.
“We don’t know exactly what they’re going to do, but from what they’re saying, it sounds functionally like new tariffs on all US imports.”
Logistical and Legal Hurdles
Implementing the plan poses major legal and logistical challenges. The US Trade Representative’s Office (USTR) is responsible for execution, but administration insiders question whether the agency has the capacity to determine precise retaliatory tariffs for each trading partner.
Officials initially considered grouping trade partners into high, medium and low tariff categories but later decided to set individual rates for each country, adding further complexity to an already challenging task.
Trump has some authority to impose immediate tariffs under existing trade laws, particularly against China, due to a 2018 investigation into its trade practices.
A 1930 law also allows the president to impose tariffs of up to 50 per cent on countries found to be discriminating against US goods. However, broader tariff measures may require congressional approval, which could prove difficult.
To ensure the plan’s legality, US Trade Representative Jamieson Greer and Secretary of State Marco Rubio are working to craft a policy that can withstand legal challenges.
Meanwhile, Navarro is advocating for swift implementation, despite concerns from more cautious officials.
Market and Industry Reactions
Even before the full details of the plan have been revealed, global markets are bracing for impact. The S&P 500 has dropped more than 8 per cent over the past month, while the Nasdaq has fallen nearly 13 per cent.
A key consumer confidence index has hit its lowest level since November 2022, reflecting growing economic uncertainty.
Manufacturing output in February reached its highest level in two years, as businesses rushed to stockpile materials ahead of expected tariff hikes. “Manufacturers raced to produce goods before large tariffs on imports could be imposed, as well as to meet a temporary tariff-induced spike in orders,” said Samuel Tombs, chief US economist at Pantheon Macroeconomics.
Meanwhile, industries facing foreign competition are lobbying for protective tariffs. The National Christmas Tree Association has requested duties on artificial Christmas trees, arguing that cheap Chinese imports are undercutting US growers.
The Southern Shrimp Alliance has also called for tariffs on frozen shrimp imports, citing a drop in domestic prices from $3 per pound in the 1980s to around $1.25 today.
JM Smucker Co. Vice President Michael Madriaga has voiced concerns over EU tariffs of up to 24 per cent on US jam and jelly exports, claiming they have stifled American sales while allowing nearly $238 million worth of similar European products into the US market.
Despite pushback, the administration is standing firm. Treasury Secretary Bessent said in a Fox Business interview that the tariff plan will consider factors such as currency manipulation and labour conditions in setting rates.
“Each country will get a number, and that will determine their tariff rate,” he said, adding that he expects some nations to lower their tariffs before the US duties take effect.
White House spokesman Kush Desai insisted that Trump’s administration remains committed to bold action.
“Although the final reciprocal tariff plan for 2 April has yet to be unveiled, every member of the Trump administration is aligned on finally levelling the playing field for American industries and workers,” Desai said.
“President Trump has assembled the best and brightest trade team in modern American history to reignite American greatness, and they are hard at work following the same playbook.”
