Britain is bracing for significant economic challenges as President Trump’s trade policies threaten to disrupt businesses and international markets. The Times reports on the widespread concern among firms anticipating increased costs and potential job losses due to tariffs on a wide range of goods, including a 25% import tax on cars. Meanwhile, Prime Minister Keir Starmer is considering offering US tech firms a tax cut in exchange for lower tariffs, highlighting the delicate balancing act the UK government must perform to navigate complex trade relations with the US. As the threat of a global trade war looms, the UK’s automotive industry, international markets, and even gold investors are all feeling the impact of these impending tariffs.
The Times’ front page news titled ‘Firms told to brace for impact of Trump tariffs’ highlights the impending economic challenges faced by businesses due to President Trump’s trade policies. The article underscores the widespread concern among firms, both large and small, as they anticipate significant disruptions and increased costs resulting from the tariffs.
The tariffs, which are set to be imposed on a wide range of goods, are expected to have a cascading effect on various sectors. For instance, the UK’s automotive industry, which exported over 101,000 units worth £7.6bn to the US last year, is likely to be severely impacted by the 25% import tax on cars. This move could potentially lead to job losses and reduced economic growth.
Moreover, the article points out that the tariffs are not just a one-off measure; President Trump has hinted at additional levies on specific sectors, which could further exacerbate the situation. The uncertainty surrounding these policies has already led to a sense of business paralysis, with companies hesitant to make long-term plans or investments.
The impact is not limited to the UK; international markets have also shown signs of instability, with stock prices tumbling in anticipation of the tariffs. Economists warn that the tariffs could lead to a global trade war, isolating American companies and disrupting international supply chains. This, in turn, could result in higher prices for consumers and a slowdown in global economic growth.
The Guardian leads with the exclusive news of Prime Minister Keir Starmer considering offering US tech firms a tax cut in return for lower Trump tariffs. This move is seen as an attempt to navigate the complex and increasingly fraught trade relations with the US, particularly in light of President Trump’s propensity for using tariffs as a means of exerting political leverage.
The digital services tax, which targets major US tech companies like Meta and Amazon, has been a point of contention in UK-US trade relations. Introduced in 2020, this tax raises about £800 million a year for the UK. However, with Trump threatening new tariffs on British exports, the government is reportedly considering modifying or even scrapping this tax to secure exemption from these duties. Chancellor Rachel Reeves has indicated that the government is seeking to balance tax fairness with protecting British trade interests.
Critics argue that this move could be seen as appeasement, especially given the recent £5 billion in welfare cuts, primarily affecting those with disabilities. Labour MPs have expressed concern about the optics of reducing taxes on tech giants while cutting lifelines for disabled people. However, supporters of the potential tax cut argue that it could be a necessary step to protect the UK economy from further shocks due to US tariffs.
The situation highlights the delicate balancing act the UK government must perform in its dealings with the Trump administration. While the digital services tax is an important source of revenue, the threat of tariffs poses a significant risk to British exporters. As the government seeks to secure favourable trade terms with the US, it must also consider the domestic implications of any concessions it makes. This news underscores the ongoing challenges of navigating global trade politics in an era of increasing protectionism and political brinkmanship.
The front page of The Telegraph, titled “Starmer’s 11th-hour bid to halt trade war” covers the last-minute efforts by Prime Minister Keir Starmer to prevent a trade war with the US. The article reveals that Starmer is finalising a package of economic concessions to the US, hoping to persuade President Donald Trump to spare the UK from his planned global import tariffs. The proposed UK concessions include easing or scrapping the Digital Services Tax on US tech giants and changing tariffs on American meat exports. However, the US administration has shown no signs of backing down, with Trump’s press secretary stating that the president is focused on fixing past trade wrongs and is open to negotiations only after the tariffs take effect.
This situation has significant economic implications for the UK, as the Office for Budget Responsibility warned that a 20% increase in tariffs on UK goods and services would cut the size of the British economy by 1%. The article highlights the tense and uncertain atmosphere surrounding the impending trade war and the UK’s desperate attempts to avoid it.
The front page of the Daily Mail is dominated by the headline “Trump’s tariffs threaten crisis for Reeves.” The article details how US President Donald Trump’s imposition of sweeping tariffs could plunge the UK into an economic quagmire, jeopardising Chancellor Rachel Reeves’ fiscal plans.
Trump is set to announce tariffs on a wide range of goods, including a 25% tariff on all cars not made in the US, effective from April 2. This move is expected to have a severe impact on the UK’s automotive industry, which exported over 101,000 cars worth £7.6 billion to the US in 2024. The Office for Budget Responsibility (OBR) has warned that these tariffs could wipe out the government’s £9.9 billion fiscal headroom and force Reeves to implement further tax rises or spending cuts as early as October.
The OBR also cautioned that the UK’s GDP could be 0.6% lower than forecast this year and 1% lower next year if the tariffs are maintained for five years. Reeves, who recently announced a £14 billion package of cuts in her Spring Statement, is now under immense pressure to balance the books amidst these new challenges. The situation has prompted calls for the UK and US to strike a deal that works for both economies, as the UK seeks to avoid a trade war.
The front page news in the Financial Times titled “Investors flock to gold as fears mount on eve of Trump tariff announcement” highlights the significant surge in gold prices and investment as traders seek safe-haven assets amid the uncertainty surrounding President Trump’s upcoming tariff announcement.
Gold reached a record $3,148.88 a troy ounce, marking its strongest quarterly performance since 1986 and bringing year-to-date gains to 19%. This trend is driven by a cocktail of factors, including geopolitical instability, inflation concerns, and strong investor demand. The fear of a global trade war has led investors to pour more than US$19.2 billion into gold-backed exchange-traded funds (ETFs) during the first quarter of 2025, the biggest inflows since the pandemic.
Central banks have also been significant buyers of gold, though the recent surge in ETF inflows indicates a broader range of investors are now seeking refuge in the precious metal. The uncertainty is likely to persist as Trump’s expansive new tariffs are expected to hit global growth, prompting several banks to increase their gold price forecasts.
The London Digital Daily led with a comprehensive overview of the impending US tariffs on British goods and the UK’s potential responses. It begins by setting the stage, noting that Britain anticipates new tariffs from the US, with no immediate exemption in sight. The report highlights President Trump’s intention to impose additional tariffs on April 2, beyond the existing 25% levy on cars and car parts. The prime minister’s spokesman emphasises the UK’s readiness for all eventualities and the ongoing constructive talks aimed at securing an economic prosperity deal. However, the spokesman also leaves the door open for retaliation if necessary while advocating for a calm and pragmatic approach.
The report delves into the political reactions within the UK, quoting Conservative and Liberal Democrat officials. Andrew Griffith criticises the government’s handling of the situation and calls for a more effective trade deal, while Ed Davey from the Liberal Democrats advocates for reciprocal tariffs and stronger alliances with European partners. The inclusion of these perspectives adds depth to the report, showcasing the differing views on how to address the potential tariffs.
