President Donald Trump said Friday he would likely announce “reciprocal” tariffs on U.S. trading partners next week.
Asked during the a press conference with Japanese Prime Minister Shigeru Ishiba whether he would impose new duties on Japan, the president instead said categorically, “we're going to have tariffs.”
Trump said that he would hold a meeting “Monday or Tuesday” on a new “reciprocal” tariff, “where a country pays so much, or charges us so much, and we do the same.” The announcement would likely come in a later news conference, Trump said.
“I think that's the only fair way to do it,” he added.
Japan has an average applied tariff rate of around 1.6%, according to the World Bank, which is comparable to the U.S.’ 1.5%.
During the presidential campaign, the president made securing more reciprocal trade terms with countries a prominent part of his trade policy agenda. Trump did not elaborate on which countries might be affected by a new “reciprocal tariff,” and a White House spokesperson did not respond by press time to Agri-Pulse’s question on the likely scope of a new tariff. But Trump has frequently complained that countries like India retain high average tariff rates while the U.S. has significantly lowered duties in recent decades.
The Japanese prime minister refused to comment on whether Japan would retaliate if it was included in Trump’s plans for a reciprocal tariff. During the same press conference, however, he committed to increasing Japanese investments in the U.S. to $1 trillion.
“Japanese technology will be provided and the better quality products will be manufactured in the United States,” Ishiba said.
Japan is a major export destination for U.S. corn and meat, importing more than $2 billion of corn in 2023, $1.8 billion of beef and $1.4 billion of pork, according to USDA data.
It is not clear what authority the president would use to impose reciprocal tariffs, or if they will materialize at all.
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Shortly after Trump’s inauguration, a group of House Republicans introduced the “Reciprocal Tariff Act,” that would grant the president powers to impose a tariff on imports of an equal rate to those paid by U.S exporters into their market. But the legislation remains in the committee stage.
Charles Benoit, a trade attorney at the Coalition for Prosperous America – a business group that has supported many of Trump’s trade policy positions – told Agri-Pulse that the president could try to use a longstanding statute designed to protect U.S. exports from discrimination.
In a trade policy memo published the day Trump took office, the White House directed the U.S. Trade Representative and Commerce Department to recommend remedies to counter unfair trade practices in other countries’ markets, including through Section 338 of the Tariff Act of 1930.
The authority has not been used in decades, but it allows the president to impose tariffs of up to 50% to retaliate against countries discriminating against U.S. exports or treating them differently than those from other foreign countries, following an investigation by the International Trade Commission. There is, however, no limit to the tariffs’ scope or duration. Using Section 338 powers in this way would likely would violate World Trade Organization rules, according to an analysis from lawyers at Covington & Burling.
“I think that's the tool to cut to get there,” Benoit said. “It is a very broad and powerful tool.”
Trump’s comments come a day after Robert Lighthizer, Trump’s former USTR and architect of his first-term trade policy, published an op-ed in the New York Times in which he called for a new tariff regime that hikes and reduces tariffs on U.S. trade partners as their trade surplus with the U.S. goes up and down.
Such a regime, Lighthizer said, would lead to a fairer distribution of the benefits of trade.
