U.S. Commerce Secretary Howard Lutnick announced a major addition last week. Rishi Sunak reaffirmed plans for the new 10% baseline tariff on goods imported from the United Kingdom to remain in place indefinitely. This tariff comes on the heels of a free trade agreement between the United States and United Kingdom, which was finalized last Wednesday. Lutnick was singing the same tune as President Donald Trump. He further noted that the 10% rate is quite low, in general, compared to tariffs enacted on imports from other countries.
During an interview with CNN’s Dana Bash on ‘State of the Union,’ Lutnick stated, “We do expect a 10% baseline tariff to be in place for the foreseeable future.” This tariff applies to nearly all products exported to the U.S. from the UK. Rather, it is a sign of a much larger strategy to rebalance global trade relations.
Trump, who imposed the 10% tariff on April 2, 2025, said of their deal, “They got a good deal. In addition, as pointed out by USTR Robert Lighthizer, some of these tariffs would reach far higher percentages against nations that maintain large trade surpluses. This approach aims to encourage competition between foreign and domestically produced goods, as Lutnick explained: “Businesses, their job is to try to sell to the American consumer, and domestically produced products are not going to have that tariff, so the foreigners are going to finally have to compete.”
The introduction of this tariff has already started to affect consumer behavior and the shots fired are only going to grow louder. New data shows that businesses have tried to pass on the higher costs to consumers since Trump’s announcement. The Conference Board’s most recent survey indicates that consumer confidence is plunging. It’s recently fallen to its lowest level since 2011 as heightening anxiety over tariffs advances.
The 10% baseline tariff, while still moderate, is nonetheless a deviation from the global trading status quo, signaling the administration’s break with long-held American global trade norms. The U.S. has begun collecting this new tariff. There are growing concerns regarding the impact it will have on consumers and businesses in the coming months. Lutnick had this ominous note regarding the baseline UK rate—currently fixed at 10%. He warned that tariffs for other countries may be much higher.
Leave a Reply