Republican candidate Donald Trump’s economic agenda for if and when he returns to power to govern the United States after the 2024 US presidential Polls, includes levying harsher trade and tax policies on countries like India and Brazil, if the latter was found imposing higher tariffs on American Goods.
The ex-president, Donald Trump, intends to center his economic plans on extending and deepening the Republican tax cuts from 2017, rolling back regulations put forth by President Joe Biden and enacting additional tariffs, according to three people familiar with the discussion.
If a country like India or Brazil had higher tariffs on American goods, Trump would slap an equally harsh levy back on that country — in a move he refers to as “reciprocity.”
The measures are tenets of Trump’s first-term trade doctrine, defined by the confrontation he stoked with China through a tit-for-tat series of tariffs. His successor, Biden, has kept up the pressure imposed on the world’s second-largest economy with additional measures targeting sensitive technology even as China grapples with economic shocks, including a real estate crisis.
Still, Trump’s nascent second-term proposals are causing angst among many economists and the business community that largely views retaliatory or higher tariffs as a form of taxation on American consumers and businesses. Jacking up tariffs could spur inflation, hurt US manufacturing and prompt other countries to increase their tariffs as well, according to John Murphy, senior vice president for international affairs at the US Chamber of Commerce, was quoted by Bloomberg.
Trump argued in a recent letter to the Wall Street Journal that criticisms like Murphy’s are “debunked talking points from corporate-funded studies about our tariffs’ alleged impact.”
Advisers say this is a continuation of Trump’s desire to negotiate at every turn, especially on goods and services entering the US.
One Trump campaign official said the former president has not settled on anything definitive regarding economic policy and intends to roll out more details this fall, as the campaign pivots to a general election message against Biden, according to Bloomberg report.
Trump may use any revenues from additional tariffs as a way to extend 2017 tax reductions like the immediate expensing of machinery and equipment and other cuts set to expire in the coming years.
Moore, an informal economic adviser to Trump, said the former president would expand the economic policies from his first term, from lower tax rates to increasing energy production, arguing that they worked.
Trump and his dinner guests did not discuss any specific numbers for potential tax cuts, or targets for tariffs. During an earlier interview with Kudlow on Fox Business, Trump threw around the idea of 10% tariffs — a figure that generated a swift and strong reaction from US companies and policy experts.
While Trump promised to abandon the North American Free Trade Agreement with Canada and Mexico, the US-Mexico-Canada-Agreement that replaced it was more rebrand than overhaul.
The American business community is not pleased that Biden continued Trump’s stance toward Beijing but worries Trump will only double down and increase these policies toward a range of other countries if he returns to the Oval Office, potentially sparking a trade war.
Source : LIVEMINT