On May 8, the United States and the United Kingdom announced a trade agreement that the Trump administration believes will support national security and American businesses.
According to the White House, the agreement is called the U.S.-UK Economic Prosperity Deal (EPD). The pledge comes weeks after Trump’s “Liberation Day” for America, where he announced a sweeping baseline 10% tariff on all the country’s trade partners, as well as higher import taxes for dozens of countries and territories.
Under the trade deal between the two countries, the 10% tariff on U.K. goods entering the U.S. will remain. However, the additional tariffs imposed on British cars will reduce from Trump’s previously set 25% to the tariff baseline of 10%. Another caveat is that the 10% rate will only apply to 100,000 British cars imported to the U.S. According to the BBC, cars above that 100,000 ceiling will face a 27.5% import tax. Notably, cars are the U.K.’s largest export to the U.S.
A significant point of the U.S. – U.K. trade agreement is that pharmaceuticals between the countries won’t face tariffs. Additionally, the countries will not tax each other on aluminum and steel. The BBC reported that the latter free trade rule also includes certain products made with the metals, such as machinery, gym equipment, and furniture.
The agreement additionally includes a laxness on agricultural goods. The U.K. has removed tariffs on American beef and ethanol. Meanwhile, British farmers will receive a tariff-free quota on up to 13,000 metric tons of exports to the U.S.
Will The U.S. – U.K. Trade Agreement Impact Travel?
So far, it’s unclear how, if at all, the new trade agreement will shake up passenger travel between the two countries. That said, per NBC News, U.S. Secretary of Commerce Howard Lutnick stated May 8 that a U.K. airline is purchasing $10 million worth of Boeing airplanes. The following day, Sky News reported that British Airways’ parent company bought 32 Boeing aircraft.
The American government claims the deal’s goals are to grow mutually beneficial trade and ensure the U.S. and U.K.’s economic partnership is rooted in a “shared vision.” Moreover, the agreement’s purpose is to create high-paying jobs for both countries and make trade easier between businesses on both sides of the pond.
According to the White House, the trade agreement has a way to go before it is set in stone. The source said, “The United States and United Kingdom are immediately beginning negotiations of the EPD to develop and formalize the proposals made in this document. Once the initial proposals have been formalized and implemented, the United States and United Kingdom understand that the EPD can further be expanded over time to cover additional areas. Each country intends to continue to improve market access under the EPD.”
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