Alongside the 10 percent baseline tariff, there’s a 50 tariff on steel and aluminum from Europe
June 20, 2025 at 07:49
- Europe wants to make a deal before July 9 when tariffs on more goods could be increased.
- Reducing tariffs could be challenging, as they currently generate revenue for the US economy.
- President Donald Trump retorted that Europe has yet to propose a fair deal with the US.
A few months ago, European officials were cautiously optimistic that they’d be able to work out a deal with US President Donald Trump to either reduce or eliminate the broader 10 percent tariffs he slapped on imported goods. Fast forward to today, and it looks like that optimism is rapidly fading.
A new report suggests that some officials are either giving up hope of a resolution or have already resigned themselves to the fact that this tariff situation might just be here to stay.
Read: Trump’s Tariffs Push Nissan And Stellantis Supplier To Bankruptcy
As it stands, nearly every product the European Union exports to the US faces a 10 percent baseline tariff. And that’s before you even get into the industry-specific tariffs, like the 25 percent on imported cars. So yes, it’s not exactly a friendly trade environment for the EU.
Some sources claim that EU negotiators are still pushing for the US to lower the base rate to under 10 percent. But, an anonymous official told Reuters that this goal has gotten a lot harder to achieve, especially now that the US is already raking in revenue from these tariffs. “10% is a sticky issue,” the official said. “We are pressing them, but now they are getting revenues.”
Europe’s Clock is Ticking
The EU has previously asserted that it would not accept a double-digit baseline rate like the UK recently did. By comparison, US Commerce Secretary Howard Lutnick has ruled out the possibility of lowering the baseline tariff below 10 percent. Europe is also having to deal with a 50 percent tariff on steel and aluminum, alongside the 25 percent auto tariff.
European officials are now racing against the clock, hoping to secure a deal before July 9, the deadline when tariffs on many other goods could skyrocket to as high as 50 percent.
No Deal – Yet
Earlier this week, President Trump told the media after his sudden exit from the G7 summit that the EU had so far failed to offer what he views as a fair deal. “We’re talking, but I don’t feel that they’re offering a fair deal yet,” he said. “They’re either going to make a good deal or they’ll just pay whatever we say they have to pay.”
On the EU side, European Commission President Ursula von der Leyen confirmed that talks are still “advancing.” She was a little more optimistic about the process, saying, “It’s complex, but we are advancing, that is good, and I push hard to pick up more speed. So we are mixed in the negotiations, and we will see what the end brings.”
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