Trump tariffs live: UK considers retaliatory action after Starmer admits trade war will damage economy

As he met business leaders to discuss the measures in Downing Street, Sir Keir warned: “Clearly, there will be an economic impact from the decisions the US has taken, both here and globally.”

The list of US products which could be hit with tariffs if the UK decides to retaliate to Donald Trump’s measures include whiskey, motorcycles and jeans.

A lengthy list of possible targets for tariffs was produced alongside a consultation on whether to introduce retaliatory measures.

The consultation said: “We want to know what you think about the impacts that any future UK tariffs might have, if applied on US goods, in response to the US government’s recent tariff announcements.

“The information gathered will help the Government to assess the scope and impacts of any UK tariff measures that could be applied.”

With Donald Trump’s new tariffs affecting UK exports, Keir Starmer’s government faces critical decisions.

What does this mean for Britain’s economy and post-Brexit trade? How will it impact UK-US and UK-EU relations?

Economists have weighed in on what Trump’s tariff measures could mean for global finances.

Professor Tommaso Valletti, Professor of Economics at Imperial College Business School, said the president’s approach was “like spinning a roulette wheel in total darkness”.

“No product is produced uniquely within a single country, as the value chain is distributed across the world,” he added.

“Even if the UK seems to be hit nominally less than other countries (but it is still hit hard), the entire system of trade is now affected.

“Trump’s tariffs will fail to close the trade and budget deficits, raise prices, and make America, the UK, and the world poorer by squandering the gains from trade.”

Sir Keir Starmer has said it would not be “wise” to tell the EU how to respond to Donald Trump’s tariffs.

He was asked if he would urge the EU to take a less “combative approach” to avoid a trade war.

Sir Keir said: “Well, in my experience, it’s not wise to go around telling other countries what they should or shouldn’t do.

“Everybody needs to act in their own best interest. And no doubt they will do so.

“My job is to lead the United Kingdom through this focused on our best interest.”

Sir Keir Starmer has acknowledged that the escalating global trade war would be “bad for working people and bad for our businesses”.

Responding to a question about tariffs at the launch of Labour’s local election campaign, the prime minister said: “A trade war is bad for working people and bad for our businesses, and I don’t think we should jump straight into a trade war.

“I think it is better if we’re able to negotiate a better outcome and that’s what we are attempting to do.”

Sir Keir added: “We’ve been talking about a new era when it comes to defence and security, particularly collective defence and security, and recognising that we are in a changing world, going into a new era, and therefore we have to act and lead differently.

“We’re at a similar point for trade and the economy, this is not just a short-term tactical exercise, it is the beginning of a new era and we need to understand that.”

Sir Keir Starmer has left the door open for the UK to give ground on a digital services tax or the online safety bill in what would be a major concession to billionaire US tech bosses.

The prime minister was asked whether he was considering a carve-out for American firms from the online safety bill, or a watering down of the digital services tax, paid by Amazon, Facebook owner Meta, and Google owner Alphabet, and did not rule it out in talks.

He is scrambling to strike a new trade deal with Donald Trump that would get the UK off the hook after his “Liberation Day” tariff announcement.

But online safety campaigners have warned him not to compromise on the rules, and Sir Keir simply said he would “act in the national interest” when questioned.

Sir Keir Starmer has refused to rule out a fresh round of benefit cuts ahead of the autumn Budget, with Donald Trump’s tariffs threatening to blow a hole in the UK’s public finances.

To meet her fiscal rules in the spring statement, Rachel Reeves unveiled a swathe of cuts to those claiming benefits, with economists warning 250,000 people would be driven into poverty.

Asked by The Independent whether he could rule out further benefit cuts to fill any hole in the public finances left by Mr Trump’s trade war, the PM said the Budget was a long way away.

He said: “There’s a lot of water that will have to go under the bridge before then.

“Obviously, my job, our job, the government’s job, is to take the steps necessary in our national interest, which is why we’re focusing on progressing the deal that we’ve been discussing with the US, making sure that we are in a position to take other measures, should they be necessary, but at the same time continuing and turbo charging the work we’re doing on growth and reform and changing our economy.

“I’m not going to get into what may or may not happen in six months time.”