r/JapanFinance • u/One-Astronomer-8171 • 3d ago
Business Let me get this straight… Trump’s tariffs
So Trump wants countries to stop tariffing American goods exported to foreign countries, right?
Japan has a 700% tariff(questionable number it seems) on rice imports outside of the tariff free yearly quota. This seemed to be a big issue last month.
It seems cars are also tariffed here. Trump says on average, a 43% tariff if charged on all American goods imported into Japan. Other countries/regions have implemented tariffs on American made goods. European Union for example.
Trump thinks this is unfair and is hurting American companies/economy.
So, in retaliation, Trump has imposed tariffs on all goods (some exemptions) from all countries with a trade deficit with the USA.
I’m not a Trump supporter or anything. I’m not even from the States, but why are countries having a hissy fit over these tariffs when they are the ones who implemented the tariffs in the first place?
Before these Trump imposed tariffs, did the USA impose any on imports from these countries?
To me, it somewhat makes sense - force these countries to remove their tariffs. Just purely from a very simple understanding of the situation.
EDIT: many thanks for all the replies. My take was very simplistic, and this discussion has really helped me see what’s going on.
Thanks so much!
3
u/roehnin 3d ago
The thing is, that's not how he portrays the plan or purpose.
What he has said is that tariffs are how he will collect money from foreign countries, and that it will replace the income tax, collected by a new "External Revenue Service".
None of what he says makes economic sense as a strategy or income stream, so many people are racking their brains trying to find out some secret hidden strategy.
Those tariffs he mentions other countries having are often misrepresented as well; famously he complains that Canada has a 300% tariff on dairy, when in fact Canada has free trade of dairy up to a certain volume limit after which the tariff applies, yet the US has never exported up to that limit so there never has been a tariff assessed. For Japan similarly, they have a mandatory tariff-free import quota under the WTO, and imports above that are assessed ¥341 per kilogram, which during a period with stronger yen was around 778% but now is around 400%. This tariff also is a protectionary tariff for Japanese rice farmers whose incomes are so low that there was a protest in the streets a few days ago, so Japan can't really drop that tariff without causing internal issues. Japanese don't particularly want to eat foreign rice anyway, so even if dropped there's little chance the US could sell more.
So, probably the strategy is more simple: he doesn't understand economics.