- President Donald Trump has threatened to levy a tax on European car imports into the US if European officials impose tax hikes on American companies.
- The European Union has sharply condemned Trump’s plan to impose a 10% tariff on steel imports and 25% on aluminum.
- One official called it “stupid” and threatened to impose tariffs on American companies, including Harley Davidson and Levi’s.
President Donald Trump has vowed to tax European car imports into the US if the European Union raises its tariffs on American companies doing business there.
“If the E.U. wants to further increase their already massive tariffs and barriers on U.S. companies doing business there, we will simply apply a Tax on their Cars which freely pour into the U.S.,” Trump said in a tweet Saturday. “They make it impossible for our cars (and more) to sell there. Big trade imbalance!”
The threat comes on the heels of criticism from Jean-Calude Juncker, the president of the European Commission, who said the EU would “react firmly and commensurately” to increased US tariffs on steel and alumnimum.
“Instead of providing a solution, this move can only aggravate matters,” Juncker said in a statement Thursday. “The EU has been a close US ally for decades. We will not sit idly while our industry is hit with unfair measures that put thousands of European jobs at risk. I had the occasion to say that the EU would react adequately and that’s what we will do.”
Juncker lashed out again on Friday, saying “this is basically a stupid process,” warning that the EU will now impose tariffs on motorcycles, blue jeans, and Bourbon.
“We can also do stupid. We also have to be this stupid,” he said.
On Thursday, Trump promised new tariffs – taxes on imports – of 25% on steel and 10% on aluminum. The president did not specify if any countries would be exempted, but the restrictions are expected to be wide-ranging.
“[US steel and aluminum industries have] been horribly treated by other countries,” Trump said. “They have not been properly represented. More importantly, because of that, our workers in our country have not been properly represented.”
A group of US industry leaders, who joined Trump at the White House during his announcement, defended the move.
“Having been somebody that has global views and believes in free trade, we know when it’s completely unfair,” said Dave Burritt, the CEO of the US Steel Corporation. “We are not protectionists. We want a level playing field. It’s for our employees to support our customers.”
But business leaders in other countries, including Canada, Mexico, and Brazil, condemned Trump’s announcement.
“I feel Trump’s decision is stupid,” Li Xinchuang, the vice chairman of the China Iron and Steel Association, told The New York Times. “It will only make the US steel industry, which is already 10 years behind China, more left behind.”