U.S. President Donald Trump, center, arrives on day three of the World Economic Forum (WEF) in Davos, Switzerland. (Photographer: Jason Alden/Bloomberg)

Trump Doubles Down on Reciprocal Tax After Meeting Tariff Pledge

(Bloomberg) -- President Donald Trump warned he planned to proceed with a so-called reciprocal tax on imports as he followed through on his call to impose stiff tariffs on imported steel and aluminum.

“We’re going to be doing a reciprocal tax program at some point,” Trump said Thursday, citing an example he’s used in the past -- that if China imposes a 25 percent duty on products imported from the U.S., then the U.S. should institute a 25 percent levy on products from China. “We’re going to be at those same numbers,” said Trump.

The president has repeated his support over the last 12 months for a levy on imports from other countries at the same rates those countries impose on U.S. products. In mid-February he said more details would be coming that week and in coming months. But a senior administration official said at the time that no formal plan was in the works.

Like the steel and aluminum tariff, a reciprocal tax could risk escalating tensions with key trading partners and could stir domestic opposition from import-dependent industries. While the reciprocal tax seems remote, the import tariff did too.

Trump defied critics and forged ahead with the 25 percent duty on steel and 10 percent on aluminum, despite resistance from many Republican lawmakers and from some of his own top advisers. Gary Cohn, his National Economic Council director, who fought against the metals tariffs, announced his resignation earlier this week.

While the president has the authority to unilaterally raise tariffs, other nations will likely challenge a reciprocal tax at the World Trade Organization, which limits how high U.S. tariffs can be.

“We just want fairness,” Trump said. “We want everything to be reciprocal and I think in the end, we’re going to have a lot of great jobs, we’re going to have a lot of great companies, and all coming back in our country.”

©2018 Bloomberg L.P.