Trump wins big in EU tariff deal

President Donald Trump announced a new trade agreement with the European Union, bringing an end to months of uncertainty by setting a 15% tariff rate on EU imports to the United States. European Commission President Ursula von der Leyen said in a statement that the pact “will bring stability” and “predictability,” which she described as “very important for our businesses on both sides of the Atlantic,” Knewz.com has learned.

Trump’s new EU tariff is a reduction from the previous rates

The agreement ends a period of rapidly shifting tariff proposals from the White House. Trump had earlier proposed higher tariffs on European goods — first a 20% rate in April and later, a 30% rate in July. However, the recent announcement brings that figure down to 15%. The new rate is similar to a trade agreement recently reached with Japan, under which Japanese imports will also be subject to a 15% tariff.

Still a higher tariff than average

Trump previously posted on Truth Social that tariffs would rise to 30%, surprising European negotiators who believed talks were near completion. In response to that threat, von der Leyen warned, “Imposing 30% tariffs on EU exports would disrupt essential transatlantic supply chains, to the detriment of businesses, consumers and patients on both sides of the Atlantic.” The European Union’s chief trade negotiator traveled several times to the United States for in-person meetings with American officials and was scheduled for another phone call with Commerce Secretary Howard Lutnick. While the new 15% tariff is a reduction from Trump’s earlier threats, it still marks an increase from the average 1.2% U.S. tariff on EU imports reported in 2024.

EU prepared retaliatory tariffs

Despite continuing negotiations with Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer, the EU had begun preparing retaliatory measures in case no agreement was reached by Trump’s August 1 deadline. According to reports, the EU finalized a list of U.S. products targeted for retaliatory tariffs. That list included Boeing aircraft, American-made vehicles and consumer goods such as bourbon and soybeans from politically sensitive U.S. states like Kentucky and Louisiana. At the time of the agreement, the EU was ready to impose up to $100 billion in retaliatory tariffs. Cars and other vehicles produced in the EU could still face increased prices. As German auto trade group VDA said in a statement, “The costs for our companies have already reached the billions — and with each passing day, the total continues to grow.”

The United States’ largest trading partner

The EU is the United States’ largest trading partner. Its $605 billion worth of imports into the U.S. surpass Mexico, Canada and even China. “The most valuable category of imports in 2024 was drugs and pharmaceuticals primarily from Ireland, followed by autos, aircraft and other heavy machinery from nations such as France and Germany,” reports have mentioned. President Trump has threatened a 200% tariff on any drugs imported into the U.S., which would not be applied for at least the next 18 months. It is now unclear whether the new trade deal with the EU will change that.

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