UK Granted Temporary Exemption from Trump’s 50% Tariff Hike

Steel and aluminium duties remain at 25%—but only if a trade deal is finalised by 9 July

UK Avoids Immediate Impact of US Tariff Increase

The UK has narrowly escaped a dramatic rise in US tariffs on steel and aluminium exports—for now. While US President Donald Trump has doubled tariffs to 50% for most countries, the UK has retained its previous 25% rate, pending the full ratification of a new US-UK trade deal.

The White House confirmed the decision on Wednesday, explaining that the exemption is only temporary and contingent on finalising the Economic Prosperity Deal (EPD) by 9 July.

Trump’s Tariff Strategy Targets Domestic Production Boost

The tariff increase forms part of Trump’s broader plan to encourage domestic manufacturing. Originally introduced in March, the 25% tariffs were seen as a way to curb reliance on foreign steel. According to White House economic adviser Kevin Hassett, doubling the duty to 50% was driven by data showing more action was needed to support American industry.

“We started at 25 and then, after studying the data more, realised that it was a big help, but more help is needed,” Hassett explained.

The UK is currently the only nation spared from the new 50% tariffs, but that relief could be short-lived if trade talks falter.

Deadline Approaches: 9 July is Crunch Time

The current reprieve is set to expire on 9 July, which the White House has dubbed a potential “Liberation Day” for trade partners. On that date, the US may choose to:

• Implement new import quotas
• Maintain the 25% rate under agreed trade terms
• Impose the full 50% tariff if the UK is found non-compliant with the EPD

Trump’s executive order makes it clear that the UK must meet all requirements of the new trade pact, or it risks losing its preferential treatment.

UK Government and Industry Respond to the Temporary Relief

The UK Government, under Prime Minister Sir Keir Starmer, remains in close talks with US counterparts to finalise the trade agreement.

A government spokesperson said:

“We’re pleased that, as a result of our agreement with the US, UK steel will not be subject to these additional tariffs. We continue working to implement the deal, which includes removing the current 25% tariffs altogether.”

The government emphasised its commitment to protecting British industry and jobs, particularly in key sectors like steel and manufacturing, as part of its wider Plan for Change.

UK Steel Industry Cautiously Welcomes Reprieve

Industry leaders welcomed the exemption but expressed concerns about the lack of long-term certainty. Gareth Stace, Director General of UK Steel, said:

“This delay helps shipments already en route to the US. But the uncertainty surrounding tariff levels and deal timelines makes US buyers hesitant.”

He added that the current situation leaves UK exporters at risk, and urged both governments to act quickly to finalise the May trade agreement.

What Comes Next?

The coming weeks are pivotal. If the Economic Prosperity Deal is ratified, UK steel and aluminium exporters may avoid higher tariffs altogether, or even see the existing 25% duties removed. However, failure to reach agreement by 9 July could see the UK hit with 50% tariffs, harming exports and jobs across the manufacturing sector.

Conclusion:
The UK’s temporary exemption offers breathing space—but not a guarantee. With economic stakes high and the clock ticking, securing a full and final trade deal with the US is now essential to protect UK industry and ensure long-term market access.

Sources: (SKY.com, Reuters)