EU expects US will not increase tariffs on its exports to 15%

The European Union (EU) expects that the US won’t increase its universal tariff on the bloc to 15 per cent, even after Treasury Secretary Scott Bessent said the higher rate would likely go into effect this week.

The EU received assurances that the US will keep a 10 per cent universal tariff rate in effect for the bloc’s exports, according to people familiar with the matter, who spoke on the condition of anonymity.

Spokespeople for the US trade representative and the European Commission, which handles trade matters for the EU, declined to comment on the matter.

“That’s likely sometime this week,” ‌Bessent said on CNBC of the 15 per cent rate order from Trump.

“During the ⁠150 days, we will ⁠see studies from USTR (United States Trade Representative) on Section 301, tariffs from Commerce (Department of Commerce) on Section 232,” he said, referring to other tariff authorities that have withstood court challenges.

He said the effort to rebuild Trump’s tariff program under these authorities would ‌bring US duty ⁠rates back to their prior levels within five months.

“They are slow moving, but they ‌are more robust,” Bessent said of the Section 232 national security-based tariffs and the Section 301 unfair trade practices tariffs.

US President Donald Trump last month put a 10 per cent universal levy in place after the Supreme Court invalidated most of his previous tariff regime. At the time, the US president threatened to increase the level to 15 per cent, but so far hasn’t introduced it.

The EU-US struck a trade deal last summer that would impose a 15 per cent tariff on most EU exports to the US while removing tariffs on many American goods heading into the bloc. That agreement has yet to be ratified by the EU.

Bloomberg reported earlier that the lower 10 per cent levy — in addition to most-favoured nation tariffs already in place — would leave about €4.2 billion ($4.9 billion) of EU exports facing tariffs above the 15 per cent ceiling agreed in the EU-US trade accord.

The new policy will increase duties above the maximum allowed level on European exports including cheese, butter, some agricultural products as well as several plastics, textiles and chemicals, according to people familiar with the EU’s assessment of the rates.

Other goods such as some spirits will face rates lower than 15 per cent, said the people, who spoke on the condition of anonymity. - Bloomberg/Reuters