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How was Donald Trump’s tariffs calculated?


Ben Chu & Tom Edgington

Check BBC

Getty Images, a picture of Donald Trump with a mathematical formula written in the backgroundGetty pictures

US President Donald Trump has launched 10% tariffs from most countries imported to the United States at higher prices because he called the “worst criminals.”

How do these tariffs tax on imports -? BBC Verification looks at the calculations behind the numbers.

What were the calculations?

White house, catch a screen on a screen used by the White House used to calculate the tariffsWhite house

Formula shared by the White House

But the real exercise is boiled in simple math: Take a trade deficit for the United States with a certain country, divide the country with the total goods and then divide this number into two.

A trade deficit occurs when a country receives more physical products (export) more than other countries.

For example, it buys more goods from the United States, it takes more goods that he sells – there is a $ 295 billion worth of goods. The total amount of goods from China is $ 440 billion.

Division 295 will be divided into 440 and get you 67% and turn it into two and round. Therefore, the tariff applied to China is 34%.

Similarly, when they appeal to the EU, the formula of the White House has resulted in 20% of the tariff.

A BBC schedule showing how the White House Methodology works

“Interaction” of Trump tariffs?

Many commentators noted that these tariffs are not interaction.

The interaction means that existing countries in existing tariffs, plus tariff barriers (such as rules for expenses).

However, the official methodological document of the White House clarifies that these tariffs do not calculate for all countries.

Instead, the tariff rate was calculated in the way that the United States can remove the trade deficit with each country.

Trump left the formula that applies tariffs about countries that buy more goods as much as they sell from the United States.

For example, the UK currently does not work in the UK trade deficit. Again, England was hit by 10% Tariff.

In total, more than 100 countries are covered by the new tariff regime.

‘Very wide effects’

Trump believes that the United States has achieved a bad deal in global trade. According to him, other countries are offended by US companies – US companies and expenses. At the same time, these countries put the US products less competitive abroad.

Thus, using tariffs to overcome trade deficiencies, Trump hopes to revive and maintain their work.

Reuters a man wearing a jacket "Automatic workers for Trump" Tuesday sitting in the flower garden during Trump's address. It also wears a baseball cap and is busted by other men in the workplaces. Reuters

The US automotive industry is one of the production sectors Trump revives

Will this new tariff regime achieve the desired result?

BBC inspection spoke to a number of economists. The extreme appearance is that the tariffs will reduce goods cut between the United States and other countries, they will not reduce the common deficit between the United States and the rest of the world.

“Yes, this will reduce bilateral trade shortcomings between the United States and these countries. However, the professor of London’s College College will be very widely affected in the calculation of Jonathan port.

The reason for this is the current general deficit is not only managed by trade barriers, but the US economy works.

For one, Americans spend more than they win and win, and this space means more than the world. Thus, it continues, despite the growing tariffs with global trading partners, it can continue to continue a deficit.

Some trading deficits may be available for a number of legal reasons – not just up to tariffs. For example, get food that is easy or cheaper to produce in climates in other countries.

Thomas Sampson of the London School of Economics: “The formula is an engineer to rationalize charging tariffs to the countries of trade deficit. There is no economic justification to do so, and this will cost the global economy.”

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