Tariffs will start on August 1, warns Howard Lutnick
- U.S. Commerce Secretary Howard Lutnick confirms that new tariff rates on the EU will take effect on August 1.
- The U.S. plans to enforce a 30% baseline tariff, which could escalate to between 20% and 50% depending on trade negotiations.
- These measures indicate a firm approach to trade policy, amid concerns over inflation and the ongoing economic relationship with Europe.
On July 21, 2025, U.S. Commerce Secretary Howard Lutnick reinforced the United States' intention to implement a significant increase in tariffs on the European Union, categorizing the August 1 deadline set by President Donald Trump as a 'hard deadline.' According to Lutnick's interview on CBS News' Face the Nation, the new tariff rates are poised to take effect on that date, signaling a stern approach from the U.S. administration regarding trade negotiations with the EU. As Lutnick emphasized, while discussions could proceed after the deadline, tariffs would be initiated regardless. If enacted, the new tariffs will impose a baseline of 30% on goods imported from the EU, which was the United States' largest trading partner in the previous year. This action comes in the wake of President Trump's warnings to multiple nations regarding escalating tariffs, which could range between 20% and 50% on various goods unless conducive trade agreements can be negotiated prior to the deadline. The anticipated tariffs are among the most aggressive trade measures taken by the U.S. under Trump's administration, indicating a shift towards a more protectionist trade posture. Lutnick's remarks suggest he believes that the inflationary impact of these tariffs will be minimal, stating that prices would remain 'low, shockingly low' and asserting that inflation would not be affected. This perspective is critical given the existing concerns regarding the global economy and pricing stability amid ongoing trade disputes. The announcements reflect the complexity of U.S.-EU trade relations and the broader implications for global markets. Additionally, the EU had previously planned to impose tariffs on U.S. goods as retaliation for new tariffs introduced by Trump on steel and aluminum imports. However, European Commission President Ursula von der Leyen announced a postponement of these levies until August 1 to allow for further negotiations. This ongoing tug-of-war over tariffs underlines the tense atmosphere surrounding international trade policy as both sides seek to navigate their economic interests while addressing trade imbalances and seeking favorable agreements.