Trump Finalizes Limited UK-US Tariff Agreement Amid Economic Uncertainty

Wed Oct 22 2025 11:50:25 GMT+0300 (Eastern European Summer Time)

President Donald Trump has signed a partial tariff agreement with the UK aimed at easing trade tensions, though significant tariffs remain in place for many goods.

The newly signed tariff agreement between the UK and US aims to reduce import taxes on certain goods, including a 10% levy on UK cars, while still maintaining higher tariffs on crucial sectors like steel. Critics label it a minor deal, emphasizing the need for clearer terms to safeguard UK industries.

In a significant move during the G7 summit in Canada, President Donald Trump signed a new order that confirms parts of a tariff deal with the United Kingdom aimed at reducing trade barriers. This agreement, initially discussed last month, is expected to lessen tariffs on UK cars shipped to the US, a vital market for Britain's automotive industry.

The pact will reduce the tariff on imports of up to 100,000 cars from the UK to the US from 25% to 10%. However, concerns persist, as this deal does not alleviate the ongoing 25% tariff applied to UK steel imports—a key issue for British manufacturers that rely heavily on exports to the United States.

UK Prime Minister Sir Keir Starmer hailed the agreement as a "very important day" for both nations, noting its potential impact on British businesses amid Trump's earlier aggressive tariff policies. The US administration has initiated a series of tariff increases in an effort to promote domestic products, leading to considerable market concerns, particularly in the UK's automotive and steel sectors.

The specifics of the agreement also include tariff reductions on certain aerospace products. Meanwhile, the UK government has expressed its ongoing commitment to pursue further tariff reductions on steel products to enhance competitiveness. Transport Secretary Heidi Alexander acknowledged the need for continued dialogue to address these pressing trade issues.

Despite the signed deal, UK Steel's leader, Gareth Stace, called for urgent clarification on specific requirements and quotas for UK steelmakers affected by US tariffs, particularly the "melted and poured" stipulation that complicates imports.

The order signed by Trump emphasized the ongoing negotiations surrounding steel and aluminum tariffs, though specific removal timelines remain unclear. The UK has faced threats of increased tariffs on steel if an agreement is not reached by early July.

Additionally, the agreement will allow the UK to import a tariff-free quota of 1.4 billion liters of ethanol from the US, marking a pivot in energy trade between the two nations, yet raising concerns for the UK sugar industry, which could face job losses due to a sudden market shift.

Trump's administration views the tariff deal as a significant achievement, yet many in the UK government and opposition parties regard it as a limited agreement without the broader benefits anticipated. Critics have referred to the deal as a "tiny tariff deal,” demanding greater transparency from the UK government regarding its full implications.

As the UK moves forward, Business and Trade Secretary Jonathan Reynolds has committed to updating Parliament on the agreement's details, ensuring that safeguards remain in place to protect British industries and food standards in light of incoming US imports.