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Keir Starmer has had discussions with
Donald Trump
in a trade deal as the UK makes one final effort to avoid additional tariffs.
Downing Street
unveiled that the leaders had a conference call to talk about an ‘economic prosperity agreement’ late last night.
The U.S. President has designated April 2 as ‘Liberation Day,’ pledging to enforce
‘mutual’ duties compensating for those imposed by every trade partner.
It seems that the EU is primarily in the crosshairs, as the president erupted, claiming that the union was established to ‘cheat’ America.
Nonetheless, Britain might still feel the impact since Mr. Trump has objected to VAT, arguing that it is unjust—even though it is a broad-based sales tax and not specifically targeted at imports.
The United Kingdom presently has a 20 percent imposition.
VAT
On the majority of products and services.
The National Institute of Economic and Social Research (NIESR) had earlier projected that such tariff levels could reduce UK economic growth by 0.4 percentage points over the coming two years, which would amount to approximately £24 billion.
Sir Keir has already been unsuccessful in securing an exception from the U.S. tariffs on steel imports, amid concerns about potential job losses.
The Prime Minister’s representative stated: “The UK is collaborating with the United States to develop an economic prosperity pact, strengthening our joint dedication to ensuring financial stability.”
During their talks, the Prime Minister and President Trump addressed the advancements achieved in their previous discussions held yesterday evening.
The UK will engage in deals solely when they align with the nation’s interests, reflecting this government’s commitment to ensuring economic stability for British citizens.
Yesterday, before delivering the Spring Statement, Chancellor Rachel Reeves gave television interviews where she stated that Mr. Trump was correct to worry about unequal trade practices. However, she also maintained that the UK was not responsible for this issue.
She suggested it would become clear if a deal could be done ‘in the next few days’.
Concerns have emerged about whether the UK might need to abandon its proposed digital services tax on technology companies as part of reaching an accord.
However, when addressing broadcasters today, Ms. Reeves referred to the 2 percent tax on social media firms, search engines, and digital marketplaces as “extremely significant,” noting that it generates approximately £800 million annually.
“We will ensure that companies, particularly those in the digital sector, contribute their fair portion of taxes,” she stated.
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