President Donald Trump is considering a plan to impose a 25 percent tariff on $200 billion in Chinese imports, more than double what he had initially proposed, a person briefed on the matter said.
The deliberations could be a sign that Trump is looking to intensify pressure in the trade standoff with Beijing even if it could significantly drive up costs on a wide range of products for American consumers.
A final decision has not been made, and a number of Trump’s threats toward China have been designed more to bring Chinese President Xi Jinping to the negotiating table than to fundamentally change U.S. economic policy, said the person, who insisted on anonymity to discuss White House deliberations.
If Trump follows through with the plan, it could significantly raise prices on televisions, clothing, bedsheets, air conditioners and other consumer products.
Trump in June instructed U.S. Trade Representative Robert Lighthizer to craft a plan to impose a 10 percent tariff on $200 billion in Chinese imports, or roughly 40 percent of the goods that China sends to the U.S. each year.
It was seen at the time as a dramatic escalation of Trump’s trade battle with Xi, as Chinese leaders had refused to back down after numerous threats by the Trump administration. China’s Ministry of Commerce called the move “blackmail.”
It was not immediately clear Tuesday why Trump is now looking at raising the proposed tariffs to 25 percent, but White House officials say trade talks with China have largely stalled.
Trump has launched an aggressive trade agenda this year, threatening several countries with high tariffs if they don’t purchase more U.S. products or allow more U.S. investment in their countries.
In recent weeks, White House officials have claimed progress in talks with the European Union and Mexico, while talks with Canada and China have broken down. Trump has shown a willingness to try to isolate countries like Canada and China that he believes aren’t quickly offering the types of concessions he has demanded.
The White House’s thoughts on increasing the proposed tariffs were first reported by Bloomberg.
Trump has complained repeatedly about the gap between the amount of goods U.S. companies buy from China and the amount of goods that U.S. companies export to China. He says this gulf, in excess of $300 billion, reflects unfair economic barriers from Beijing.
U.S. business groups have expressed angst about Trump’s approach, warning it could drive up costs for companies and consumers. But Trump has urged patience, promising his approach will work if lawmakers and business leaders fall in line and give him more time to negotiate.
Lighthizer published a list of the $200 billion in products that would face the 10 percent tariff threshold several weeks ago. The move came after China retaliated against tariffs Trump had initially imposed on $34 billion in Chinese imports to the U.S.
Administration officials at the time said the tariff fight was aimed at forcing China to stop stealing American intellectual property and to abandon policies that effectively force U.S. companies to surrender their trade secrets in return for access to the Chinese market.
There is still a lengthy process that must take place before any proposed tariffs go into effect, if the White House decides to move forward. The Commerce Department must first solicit public feedback and then deliberate again whether to proceed. This could provide Trump ample time to scale back any import penalties or scrap the idea altogether.
First published by The Washington Post