Small businesses are urging the US Supreme Court to expedite a review of former President Donald Trump’s tariffs, arguing that the levies are an unlawful tax burden. This comes as a new UK-US trade pact, signed by Sir Keir Starmer and Donald Trump, aims to reduce some tariffs, though concerns remain for the steel industry.
Small businesses challenge Trump’s tariffs
Learning Resources, an educational toy manufacturer, has formally requested the US Supreme Court to fast-track a review of the legality of Donald Trump’s tariffs. The company argues that these tariffs, which have been ruled against by two lower courts, constitute an unlawful tax on American businesses and consumers. CEO Rick Woldenberg stated that an early Supreme Court intervention could save US businesses hundreds of billions of dollars.
- Two district courts have found Trump’s use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs unjustified.
- The Trump administration is appealing these rulings, leaving the tariffs in place.
- The Supreme Court rarely intervenes before lower court appeals are exhausted but has done so in cases with widespread impact, such as the student loan forgiveness plan.
UK-US trade pact signed, but steel concerns linger
Sir Keir Starmer and Donald Trump have signed a new UK-US trade deal at the G7 summit in Canada. The agreement aims to reduce some trade barriers, notably lowering tariffs on UK cars shipped to the US from 27.5% to 10%. The deal also removes tariffs on certain aerospace products and includes tariff-free quotas for US ethanol and beef imports into the UK.
However, the agreement has not yet addressed the removal of tariffs on steel imports, which remain at 25% for UK steelmakers. This has prompted calls from trade unions and industry bodies for a swift resolution to protect the sector.
- Key provisions of the UK-US trade pact:
- UK car tariffs to the US reduced to 10%.
- Tariffs on certain aerospace products removed.
- UK grants tariff-free quota for 1.4 billion litres of US ethanol.
- UK scraps 20% tariff on US beef imports and raises quota to 13,000 tonnes.
Steel industry seeks clarity and full exemption
Despite the broader trade pact, the UK steel industry faces continued uncertainty. While temporarily spared from a 50% global tariff, UK steel imports to the US still incur a 25% levy. Industry leaders and unions are pressing for a full exemption and clarification on the ‘melted and poured’ requirement, which affects companies like Tata Steel that import some raw materials.
- Challenges for UK steel:
- Continued 25% tariffs on US imports.
- Uncertainty over the ‘melted and poured’ rule for tariff exemptions.
- Risk of 50% tariffs if a full agreement is not reached by 9 July.
In a positive development for British Steel, the company has secured a new £500 million, five-year contract with Network Rail to supply rail tracks, bolstering the Scunthorpe steelworks.
Sources
- £500m rails deal to bolster Scunthorpe steelworks, say Ministers, Business Live.
- Small business seeks early Supreme Court review of Trump’s tariffs, Reuters.
- ‘Vital’ that British steel gets Trump tariff deal after UK-US trade pact, say unions, The Guardian.
- Business news live: FTSE 100 falls but oil shares rise after UK-US trade deal, The Independent.
