President Donald Trump, in a series of tweets, retaliated to the Chinese tariffs imposed on the US goods, by increasing the import taxes on Chinese goods. Trump, on Friday, said that the goods from China, currently being taxed at 25%, will be taxed at 30%, starting October 1st.
The move comes after the Chinese State Council said it will inflict tariffs ranging from 5% to 10% on $75 billion in U.S. goods. These tariffs will be effective on September 1 and December 15, in two lots respectively. Agricultural goods, aircraft, crude oil and 5,000 different products will be affected by these tariffs. Additionally, 25% tariff will be imposed on U.S. cars and 5% on auto parts and components starting this December.
President Trump blamed China for “taking advantage of the United States on Trade” and “Intellectual Property Theft”. In a tweet, he said, “China should not have put new Tariffs on $75 billion of United States product (politically motivated!). Starting on October 1st, the $250 billion of goods and products from China, currently being taxed at 25%, will be taxed at 30%.”
Also, another $300 billion of goods and products from China will be taxed at 15% which was earlier taxed at 10%. These taxes will be effective from September 1st, Trump said. So, essentially, $550 billion of Chinese goods will be hit with 5% extra tariffs.
It should be noted that China taxed the US goods because President Trump had revealed that 10% of tariffs will be imposed on Chinese goods ($300 billion mentioned earlier) starting in December. He had reasoned that China did not keep its commitment to buy more American agricultural products, for imposing these tariffs.
The sudden sparks in the China-UStrade war have set the market tumbling. The US stock markets experienced ups and downs during this whole scene. The markets dropped following the news of the Chinese tax imposition and stabilized after a little, only to fall again after Trump’s announcement. The shares of Dow Jones Industrial Average and the Nasdaq and the S&P 500 fell 2.3%, 2.9%, and 2.5% respectively after Trump’s statement.