U.S. Begins 25% Tariff on Chinese Goods

The U.S. kicked off its latest round of protective tariffs at midnight in the form of a 25% tax on $34 billion of Chinese imports.

The levies follow the global import tariffs of 25% on steel and 10% on aluminum that began last month. Analysts say last night’s move is all but certain to launch a rapidly escalating trade war with China.

President Donald Trump confirms to reporters that another $16 billion in Chinese goods could be added to the U.S. target list two weeks from now. He reiterates that he might raise total value of taxed items to as much as $550 billion—more than the total value of all Chinese goods shipped to the U.S. last year—if that country retaliates.

China has already announced plans to respond. The country had lowered its import tax on American-made vehicles from 20% to 15% two weeks ago in a bid to avert a trade conflict. Now it says it will hike the rate to 40% on Friday. Last year China imported about 270,000 cars and SUV from the U.S., a fleet worth roughly $11 billion.

China also is widely expected to respond to new rounds of U.S. import taxes by imposing non-tariff barriers, such as regulatory reviews and customs delays, to throttle U.S. business operations in the country.