President Donald Trump has said the global tariffs he plans to announce this week will correct decades of unfair relationships and stop other countries from ripping off the United States. But whether the president’s so-called reciprocal tariffs will result in higher levies on other nations or lower ones remains unclear.
The president has described his global tariffs as a negotiating tool that could force other countries to drop their trade barriers to U.S. products and result in more goods flowing across borders.
But the president has also talked about the tariffs as a way to raise revenue for the government and shift supply chains back to the United States. For those goals to be accomplished, relatively high tariffs would have to be imposed, and not dropped.
Those conflicting goals will come to a head this week, when Trump is expected to reveal the details of his reciprocal tariff plan. Trump has taken to calling April 2 “liberation day,” saying it will represent the country breaking free of past trade relationships that he says have hurt the United States.
It’s not yet clear what Trump will announce. His advisers have been weighing several different strategies and legal authorities, some of which would be more focused on raising revenue, and others that would be geared toward negotiations and opening global markets, three people familiar with the plans said. Some of the plans under consideration could take effect immediately, while others would take more time but be more insulated from legal challenges.
Trump will be the ultimate decision-maker, as recent tariff actions have shown. Some of his advisers, along with the business community, have been surprised by some of the actions he’s announced in recent weeks, such as placing levies on auto parts.
One of the biggest proponents of tariffs among Trump’s advisers is Peter Navarro, a senior trade adviser. In an interview on Fox News Sunday, he said that the tariffs would raise about $6 trillion in revenue over the next decade, and that those revenues would go toward funding “the biggest tax cut in American history for the middle class.”
The $6 trillion figure appears to echo an analysis of a “universal tariff” that the White House has examined. The analysis looked at the impact of imposing a 20% flat tariff on all imports and concluded it would raise about $6.5 trillion over a decade, a person familiar with the conversations said.
The Wall Street Journal reported Sunday that Trump’s advisers had weighed imposing a global tariff of up to 20% on virtually all U.S. trading partners.
Treasury Secretary Scott Bessent recently described the reciprocal tariff plan differently. He said that each country would receive a “number” reflecting what the White House considers the cost of its foreign trade barriers, which would be low for some countries and high for others.
Bessent added that some countries that have negotiated agreements with the United States might not face tariffs. The United Kingdom and India are among those angling to receive lower tariffs by pre-emptively discussing deals with the Trump administration, people familiar with the talks said.
Ambiguity about whether America’s trading partners will end up facing higher or lower tariffs has allowed the Trump administration to temporarily paper over a significant division in the Republican Party when it comes to trade.
For now, Republican free traders and prominent business groups have gone along with the president’s reciprocal tariff proposal, while pushing him to adopt what they call “zero for zero” tariffs – if other countries drop their tariffs on U.S. products to zero, the United States will drop its tariffs, too.
Stephen Moore, an economist at the Heritage Foundation, a conservative think tank, said he was confident that the president’s goal was to lower tariffs rather than raise them, saying that Trump had conveyed that to him in conversations.
“He’s said many times, ‘I’m a free trader. I just want fair trade,’ ” Moore said.
But Moore added that there was not a consensus among Republicans that tariffs were the right path forward.
“For the last month there’s been way, way too much talk about tariffs and way too little talk about cutting taxes,” he said. “We’re talking about an issue that divides Republicans rather than unifies Republicans.”
Sen. Tim Kaine, D-Va., said his Republican colleagues had been “expressing concern” about tariffs. Kaine is expected to introduce a resolution Tuesday that will force Republicans to vote on whether to block the president from using his emergency powers to put tariffs on Canada.
“I know they’re hearing from their farmers, just like I am,” Kaine said. He said the experience of the agricultural sector in the trade wars of Trump’s first term was “really painful.”
Some of Trump’s advisers who support freer trade appear to have pushed for the reciprocal tariff plan that would result in different tariff rates for countries and that could be negotiated.
But the desire to drop barriers and open up trade has rankled a core section of Trump’s supporters who want tariffs to be significantly higher, and believe past free trade agreements were harmful for the United States. Some believe across-the-board tariffs should be imposed on all imports to generate revenue to finance tax cuts. Others argue that even higher tariffs should be put in place to encourage companies to reshore their supply chains to the United States.
Some trade experts have argued that these goals – raising revenue and reshoring supply chains – also contradict each other. For the government to take in so much revenue, Americans would need to continue buying substantial amounts of imported products. And if factories shifted into the United States instead, government revenue from tariffs would drop.
Many economists have argued that the revenue generated by tariffs will ultimately be paid for by American consumers and businesses, which are likely to bear the brunt of tariffs. Those additional costs could be jarring for Americans, especially after Trump campaigned on reducing inflation that plagued the United States and other countries during the Biden administration.
The Yale Budget Lab estimated that Trump’s new auto tariffs, which are scheduled to take effect Thursday, could raise $600 billion to $650 billion in revenue from 2026 to 2035.
U.S. vehicle prices would rise by 13.5% on average, the equivalent of an additional $6,400 for the price of an average new 2024 car. Every American household would pay an extra $500 to $600 as a result of the tariffs, the group estimated.
Karoline Leavitt, the White House press secretary, said Monday that the president’s tariff rollout Wednesday would be the administration’s first in the Rose Garden with the full Cabinet in attendance. She added that there would be “no exemptions at this time.”
This article originally appeared in The New York Times.