President Donald Trump on Wednesday announced a 10% tariff on all imports but even higher rates on dozens of trading partners including China, India and the European Union.
The tariffs range between 10% and 50% and involve some of America’s biggest trading partners.
“Reciprocal. That means they do it to us and we do it to them,” Trump said at a Rose Garden event at the White House on Wednesday.
The “reciprocal” tariffs are based on trading practices that Trump said are unfair to the United States.
During his speech, he defended all of his tariffs as “kind,” saying the taxes, by and large, they are lower than the tariffs and other trade barriers other countries impose on imports from the United States.
What is a reciprocal tariff?
Trump's approach to "reciprocal" trade is a tit-for-tat strategy to rectify trade imbalances by imposing higher tariffs.
A chart Trump displayed at the event showed that goods from China will face a 34% reciprocal tariff. Imports to the U.S. from the European Union will face a 20% tariff.
It’s unclear how the White House calculated the tariffs other countries impose on the U.S. that Trump cited Wednesday. The figures, calculated by Trump's top economists at the Council of Economic Advisers, included “currency manipulation and trade barriers.”
But even the "half-reciprocal" approach is "a lot more aggressive" than what many economists and markets anticipated, according to Ryan Sweet, chief U.S. economist at Oxford Economics.
"The Trump administration is essentially throwing the kitchen sink of tariffs at our trading partners," Sweet said. If they hold, "this is going to give the economy a black eye, but it's not a knockout punch. I don't think it guarantees a recession, but the economy is going to feel it. Consumers are going to feel it. Manufacturers are going to feel it."
The universal 10% tariffs are set to go into effect at 12:01 a.m. EDT Saturday. The reciprocal tariffs are set to begin April 9.
What is a tariff?
Tariffs act as taxes imposed on goods imported from other countries.
The companies importing those goods tend to pass on at least part of those higher costs to consumers, which is why economists warn that tariffs can be inflationary. Some economists predict lower-income households will feel the biggest blow.
"The tax revenues and price increases from tariffs will leave less disposable spending power in consumer pockets, weighing on economic growth and hiring in the rest of 2025," Bill Adams, Chief Economist for Comerica Bank, said in a Wednesday note.