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President Donald Trump is preparing to unveil a new set of tariffs on imports this Wednesday, which he has dubbed “Liberation Day”, the Associated Press reported. The announcement, which will likely impact a range of products from cars to pharmaceuticals, has sparked concern among economists, business leaders, and consumers alike. But what exactly is Trump planning with these tariffs, and how might they affect your daily life? Here’s what you need to know:
What Are the Proposed Tariffs?
Trump’s upcoming tariffs are expected to include “reciprocal” tariffs, meaning the US will impose tariffs on imports based on what other countries charge American goods. Trump has suggested taxing countries like the European Union, South Korea, Brazil, and India, with specific targets such as the 25% tariff on automobiles and additional taxes on pharmaceuticals, copper, lumber, and oil imports from Venezuela.
The president has framed these tariffs as a way to “free” the US from foreign goods that, he believes, have harmed American workers and industries. He claims that these import taxes will encourage companies to invest more in US production and create more jobs in the process.
How Could These Tariffs Affect You?
While Trump has said these tariffs will revitalise the US economy, most economists have warned that they could lead to higher prices for consumers. Tariffs on automobiles alone could add as much as $4,711 to the price of a vehicle, according to economist Art Laffer, AP reported. Additionally, building materials like lumber and copper could become more expensive, potentially driving up the cost of housing.
Columbus, Ohio’s Mayor Andrew Ginther has warned that tariffs could raise the median home price by $21,000 due to the higher cost of construction materials, the report said, adding that the US economy could also suffer in other ways, with slower growth and potential job losses in industries that rely on global supply chains.
The Impact on Global Trade
The global community has reacted with concern, as many countries prepare to retaliate. Canadian Prime Minister Mark Carney has already announced retaliatory tariffs, and European leaders, including French President Emmanuel Macron, have called Trump’s move “not coherent.” They argue that these tariffs could break value chains, create inflation, and destroy jobs in both the US and abroad.
Chinese officials have also weighed in, warning that a tariff war could harm the global trading system. Chinese spokesperson Guo Jiakun reportedly said that no country wins in a trade war, and that such policies would only worsen the issues Trump seeks to resolve.
Will the Tariffs Be Short-Lived?
While Trump has made it clear that he wants to use tariffs as a negotiating tool, it’s unclear how long the taxes will last. He has expressed openness to cutting deals if other countries show more respect for the US.
According to the report, Commerce Secretary Howard Lutnick said the tariffs will force other nations to show Trump “respect,” but some experts, like Samuel Rines from WisdomTree, have reportedly cautioned that the long-term effects on inflation could be significant. If tariffs increase the cost of goods, it could eventually lead to price hikes in services as well, such as auto repairs or insurance, the report said.
Why Does Trump Call This ‘Liberation Day’?
The term “Liberation Day” has become a symbolic phrase for Trump, who has used it multiple times in the past to describe key moments in his political career. Last year, he referred to Election Day as “Liberation Day” for America, and he similarly declared his January 2025 inauguration as another such moment. By labelling his tariff announcements in the same way, Trump underscores his belief that these policies represent a pivotal moment for US sovereignty and economic strength.
Phillip Braun, a finance professor at Northwestern University, told AP that the tariffs will harm the US economy, and that other nations will retaliate, further escalating tensions and economic instability. According to the report, consumer confidence has already been affected by these uncertainties, with many people concerned about the potential long-term consequences.
What’s Next?
As Trump’s tariffs take shape, the potential economic fallout will continue to unfold. While some businesses might benefit in the short term by shifting production to the US, the overall impact on prices, job security, and global trade could be negative for consumers, trade experts have warned.
