WASHINGTON: US President Donald Trump declared tariff war by promising to impose taxes on foreign countries to boost US revenue. He vowed to avoid extra taxes on Americans. Trump also announced plans to “take back” the Panama Canal but gave no details during his inaugural address as the 47th president.
“Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens,” Trump said.
He pledged to create an “External Revenue Service” to collect tariffs and duties. “I will immediately begin overhauling our trade system to protect American workers and families,” he added.
Focus on Trade and Tariffs
Trump’s focus on tariffs coincides with plans to review trade policies with China and North American neighbours. Since his November victory, he has criticized allies and adversaries, proposing new tariffs to address US concerns.
Before returning to the White House, Trump promised 25% tariffs on imports from Canada and Mexico. He also proposed 10% tariffs on Chinese goods if those countries fail to address illegal immigration and fentanyl flows.
On the campaign trail, Trump suggested even steeper tariffs, up to 60%, on Chinese imports. However, he stopped short of announcing new tariffs on Monday.
Emergency Measures
The White House said all federal agencies would adopt “emergency measures to reduce the cost of living.” Trump also unveiled his “America First Trade Policy” and rejected foreign influence on US tax policies.
In his speech, Trump promised the new “External Revenue Service” would bring “massive amounts of money” from foreign sources. The name mirrors the Internal Revenue Service, which handles domestic taxes. “The American dream will soon be back and thriving like never before,” he said.
Some analysts warn tariffs could increase consumer prices and slow GDP growth. However, Trump’s supporters argue that tax cuts and deregulation will drive economic expansion.
Also Read: Trump withdraws US from Paris Climate Agreement again
Trump’s Treasury Secretary nominee, Scott Bessent, told lawmakers last week he disagreed that tariffs would hurt Americans.
New Department Announced
Trump also announced a “Department of Government Efficiency” (DOGE) to cut federal spending by $1 trillion. Elon Musk and Vivek Ramaswamy will lead the department.
DOGE will serve as an advisory office, but Musk’s influence and close ties to Trump bring added political weight.
