Despite the recent announcement of a new trade agreement between the United States and the United Kingdom, baseline American tariffs on British imports will remain at 10%. This was confirmed by U.S. Secretary of Commerce Howard Latnick in an interview with CNN.
“We expect the 10% baseline duty to remain in place for the foreseeable future. We won’t go below 10%,” Latnick emphasized. His statement sent a clear signal to British manufacturers who had hoped for deeper reductions in trade barriers following the deal between London and Washington.
Trade Agreement: A Step Forward, But Not a Breakthrough
The agreement, presented on May 8 by UK Prime Minister Keir Starmer and U.S. President Donald Trump, was initially seen as a significant move in bilateral economic relations. Under the deal, the U.S. committed to lifting tariffs on British steel and aluminum and reducing the automotive tariff from 27.5% to 10% but only for up to 100,000 vehicles per year. In return, London will remove tariffs on imported U.S. ethanol and grant market access for American beef.
However, Latnick’s comments cooled expectations of further tariff relief. In effect, the baseline tariff rate remains unchanged, casting doubt on the long-term benefits for many British exporters, particularly in engineering and pharmaceuticals.
Exceptions for Strategic Sectors
Nevertheless, Latnick clarified that certain exceptions would apply — especially in the aerospace sector. “We’ve stated that we will not impose tariffs that would disrupt the supply of British Rolls-Royce aircraft engines for Boeing aircraft,” he noted.
This exception reflects the strategic partnership in high-tech industries such as defense and aviation and demonstrates the U.S.’s willingness to selectively ease tariffs in highly specialized segments.
London Reaction and Political Commentary
During an official visit to the West Midlands, Prime Minister Starmer spoke at the Jaguar Land Rover plant, stressing that the deal opens new horizons for British agriculture and the automotive industry. He emphasized that access to the U.S. market would not come at the expense of high-quality standards and described the agreement as “the result of diplomacy grounded in pragmatism.”
His remarks were widely interpreted as a subtle response to critics who accused him of being overly conciliatory toward the Trump administration. Nonetheless, Downing Street called the deal “a major diplomatic victory.”
Reform UK leader Nigel Farage also welcomed the agreement, calling it “a step in the right direction” and a clear demonstration of Brexit’s advantages. He emphasized that the UK is now “at the front of the line, not the back.” However, he also pointed out that the automotive section of the deal somewhat favors the U.S., though “tariffs are now closer to fair parity.”
What’s Next?
The full text of the agreement has yet to be released, but both sides continue to describe it as historic. According to Starmer, the next key milestone will be the UK-EU summit on May 19, where the British government hopes to negotiate improved trade terms and strengthen economic ties with European partners. This meeting could prove pivotal in shaping the post-Brexit economic architecture of the United Kingdom.
In the meantime, the U.S. position on maintaining the 10% baseline tariff highlights that, despite political rhetoric on closer ties, Washington remains committed to protecting its domestic market. This means that British businesses will have to seek competitive advantages not solely through tariff preferences, but also through innovation and increased efficiency.
The U.S.-UK trade deal continues to spark active debate across business and political circles. In an era of global uncertainty, even a limited step toward closer trade cooperation between the two nations is seen as a positive signal for investors and business communities on both sides of the Atlantic.