One year after US President Donald Trump’s major tariff offensive, his government is adding further taxes. In the future, a duty rate of 100 percent of the value of the goods will generally be due on patent-protected medicines, according to a decree from the White House. For large companies this applies in 120 days, for smaller companies 60 days later.
The EU and therefore Germany are excluded because of the agreement concluded. However, the US government is also changing its customs rules for imported steel and aluminum products, which also apply to Germany.
Government wants to bring production to the USA
The move makes it clear that the US government is sticking to its aggressive tariff policy even after the landmark ruling by the Supreme Court. Trump made it the core element of his second term in office. On the one hand, he wants to use tariffs to bring more production to the USA and thus secure jobs. In addition, his government is aiming for billions in additional revenue.
The high drug prices in the USA in particular have long been a thorn in Trump’s side. New tariffs were therefore already expected. In addition to EU countries, Switzerland and the United Kingdom are also exempt, and the exception also applies to Japan. According to the information, countries can also reduce their tariffs to zero if they reach agreements with the government and start building factories in the US.
Changes to aluminum could also affect Germany
In addition to pharmaceuticals, the US government also wants to make changes to aluminum, steel and copper. “We have not received the desired tariff revenue as the world has artificially lowered the reported cost of steel imports into America,” a senior administration official said.
The tariff rate of 50 percent should therefore not be levied on the exporter’s price in the future, but on the price that is due on the American market. This could mean significantly higher taxes for companies that export to the USA.
German export industry is groaning under tariff burden
However, the tariff rate could even fall for other products. As long as they consist of more than 15 percent steel, aluminum or copper, a uniform rate of 25 percent will apply in the future. Previously, a 50 percent rate was charged on the portion of the product made from one of the substances, the government official said.
The consequences of Trump’s customs policy are already clearly being felt in the German economy. Last year, exports to the USA collapsed – China replaced the United States as the most important trading partner.
