Concerns are mounting that the new tariffs and subsequent retaliatory actions from international trade partners could negatively impact American exporters.
According to a Bloomberg report citing Washington sources, US officials are exploring options to lessen the potential negative consequences of the widespread tariffs introduced by President Donald Trump. These discussions are reportedly happening without Trump’s direct involvement, highlighting internal concerns about his evolving trade policies.
Last week, Trump instated a minimum 10% tariff on all imports and implemented “reciprocal” tariffs, ranging from 11% to 50%, on numerous countries accused of unfair trade practices. These actions included an additional 34% duty on Chinese imports, adding to an existing 20% rate, and a 20% levy on goods from the EU, among others.
On Monday, Trump threatened to impose an additional 50% tariff on all goods imported from China unless Beijing rescinds its recently announced 34% hike in response to US levies. Numerous other countries have condemned Trump’s tariffs and pledged to implement their own countermeasures.
Bloomberg reports that officials within the Trump administration worry that retaliatory tariffs will harm US exports, thereby affecting American companies’ ability to sell their goods internationally. Sources indicate that discussions are underway regarding a possible exporter tax credit, essentially a subsidy, for US firms selling products and services overseas. This credit, which would require congressional approval, could be issued by the end of the year.
Officials are also considering a credit for importers, designed to protect US companies from increased costs associated with sourcing goods from countries affected by Trump’s tariffs. These actions are aimed at mitigating the economic impact on both exporters and importers once the tariffs are fully implemented.
Bloomberg’s sources claim that neither Trump nor Treasury Secretary Scott Bessent have been formally informed about these discussions, and the proposals have not yet received complete support from the administration’s economic advisors.
A Treasury spokesperson acknowledged the discussions but emphasized that discussions of “specific provisions” are still in the preliminary stages. The spokesperson further stated that any tax proposals or initiatives pursued by Bessent would align with his “full support for President Trump’s America First Economic Agenda.” The White House has not commented on the report.
Trump’s tariffs and the potential for retaliation have heightened fears of a global trade war. Several investment banks have increased their risk projections for both the US and global economies in the past week. Stock markets have reacted negatively, with major indexes in the US, Europe, and Asia all experiencing declines over the past three days.
Despite the criticism, Trump defends the tariffs as crucial for rectifying trade imbalances. On Monday, he asserted on social media that the measures are effective and generating significant economic advantages for the US.