Government launching consultation over possible retaliatory tariffs against US, says business secretary – UK politics live
Reynolds says government launching consultation with business on possible retaliatory tariffs against US
Reynolds says he is now opening a consultation on possible retaliatory tariffs.
It remains our belief that the best route to economic stability for working people is a negotiated deal with the US that builds on our shared strengths.
However, we do reserve the right to take any action we deem necessary if a deal is not secured.
To enable the UK to have every option open to us in future, I am today launching a request for input on the implications for British businesses of possible retaliatory action. This is a formal step necessary for us to keep all options on the table.
We will seek the views of UK stakeholders over four weeks until 1 May 2025 on products that could potentially be included in any UK tariff response.
This exercise will also give businesses the chance to have their say and influence the design of any possible UK action.
Reynolds stresses that retaliatory tariffs are only an option, and that the government still wants an economic deal instead.
If we are in a position to agree an economic deal with the US that lifts the tariffs that have been placed on our industries, this request for input will be paused, and any measures flowing from that will be lifted.
Reynolds says further information about the consultation will be on the gov.uk website later today.
Key events
At the Labour local elections launch this morning Keir Starmer strongly played down any suggestion that the Online Safety Act would be watered down as part of a UK/US economic deal – while not quite saying it would not feature at all. (See 12.38pm.) It has been reported that the UK could be offering a review of the legislation. (See 10.49am.)
At the Downing Street lobby briefing the PM’s spokesperson delivered a similar message – saying “basic protections” were not up for negotiaton. He said:
We’ve said previously our Online Safety Act is all about protecting children online, making sure what is illegal offline is illegal online. The technology secretary has reiterated that our basic protections for children and vulnerable people are not up for negotiation. That remains the government’s position.
Here is Guardian video of Keir Starmer giving his response this morning to the Trump tariffs announcement.
Reynolds urges MP ‘not to invent problems that don’t exist’, when asked Online Safety Act being part of US deal
Bobby Dean (Lib Dem) says when US rightwingers talk about freedom of speech, they mean they want US tech companies to continue to be free to impose harmful content on children. He asks Reynolds to rule out the Online Safety Act being part of UK/US economic deal.
Reynolds urges MPs “not to invent problems that don’t exist”. He says the talks with the US are focused on “goods and services in the main”.
Reynolds say US tech companies will still have to pay ‘fair rate of tax’ in UK – without ruling out changes to digital services tax
Back in the Commons Lisa Smart (Lib Dem) asked Reynolds if the government would cut the digital services tax (DST) as part of its economic deal with the US.
Reynolds said he would not discuss the specifics of the negotiations. But he went on:
Making sure any tech company – not just a US tech company, any tech company – pays a fair rate of taxation in the UK for the economic activity that they have in the UK is something all parts of the British government are committed to, and [Smart] doesn’t need to be worried about that.
I would just say that there’s always going to be, in any discussion, a lot of issues that need to be dealt with, and in the main, those are trade issues.
I understand there’s all kinds of speculation. Speculation isn’t always correct, and I would just ask all colleagues to bear that in mind, understand we can’t publicly, in a negotiation like this, share every single aspect of it.
But if she’s worried about US companies, or any tech companies paying the right rate of tax in the UK, I can tell that’s something we’re deeply committed to.
Reform UK MPs criticised for missing Commons statement about Trump tariffs
In the Commons Blake Stephenson (Con) says the Trump tariffs will make “everyone poorer”. He says it is noteworthy that Reform UK MPs “have not bothered to turn up to share in our disappointment”.
Reynolds agrees, saying he is right to note the “conspicuous absence” of Nigel Farage and his colleagues.
Starmer repeatedly accuses Farage of ‘fawning over Putin’ at Labour local elections campaign launch
Ben Quinn
Ben Quinn is a senior Guardian reporter.
Keir Starmer has accused Reform UK of “fawning over Putin” as the prime minster used Labour’s local elections launch to turn maximum fire on Nigel Farage’s party over foreign relations and the NHS.
In a sign of how Labour views Reform as potentially a greater threat than the Tories, Starmer devoted more time to hitting out at Reform than at the Conservatives.
Labour chose a Derbyshire county council area voted the worst in Britain for potholes as location for the launch, during which Starmer accused the Tory-controlled local authority of being responsible for potholes and anti social behaviour.
But Starmer spared most of his ammunition for Reform, listing the rightwing voting record of the party’s MPs on workers rights and its position on the NHS.
“They claim to be the party of patriotism. I’ll tell you this, there’s nothing patriotic about fawning over Putin,” he said, during a speech and a Q&A with reporters where he used the phrase “fawning over Putin” three times.
Farage claims, if Tories had done better with Brexit, UK would have avoided tariffs because US deal would be in place
The US tariff announcement is difficult for Reform UK because the party, and its leader, Nigel Farage, are closely identified with Donald Trump, and Trump was deeply unpopular with British voters (including Reform UK supporters) even before yesterday. The tariffs will probably make him ever more toxic.
Reform does not seem to have issued any statement on the tariffs announcement last night.
But this morning Farage posted this on social media.
10% tariffs from the USA are bad news, but better than 20% for EU members.
If the Tory government had delivered quickly on Brexit we would have had a free trade deal years ago.
This deal is still achievable.
Ed Davey, the Lib Dem leader, responded with this.
If you’re such good mates with Trump, how about you pick up the phone and tell him to drop the tariffs?
The US hit countries they have trade deals with too. But we can always count on you to play the loyal sidekick to the bully Trump.
Reynolds says Online Safety Act has not been part of his trade talks, adding US ‘not seeking to make children unsafe’
Munira Wilson (Lib Dem) asks Reynolds to refuse to water down “in any way, shape or form” the Online Safety Act.
Reynolds says his talks with his US counterpart have not covered this issue.
And he says the US “is not seeking to make our children unsafe”. He goes on:
I think sometimes the Liberal Democrats are inventing problems to try and propose that they are the solution to them. This is a conversation about trade, and I think it’s just vitally important we keep it in that important and appropriate terms.
Back in the Commons, the Conservative MP Desmond Swayne said that tariffs always reduce the choice available to consumers.
So it isn’t Liberation Day, it’s the very antithesis, and I hope [Reynolds] will bear that in mind as he considers the policy and the consultation on any retaliatory action.
Swayne made this sound like a question critical of the government, but this is another example of a Conservative saying Donald Trump has made a big mistake. (See 11.29am.)
Reynolds said Swayne was right, and that a trade war was not in anyone’s interests.
Starmer plays down suggestions Online Safety Act could be watered down as part of UK/US economic deal
Q: Will your trade deal include concessions to US tech companies on online safety (see 10.49am), and tax cuts for US tech billionaires?
Starmer says only this week he has been speaking about how important online safety is.
He will act in the national interest, he says.
But it is the national interest to make sure that young people are safe online. That is why the drama Adolescence was so powerful, he says.
When it comes to online safety, I’ve recently, even in the last few days, made it clear how important I think online safety is. We had a round table with the writer and CO producer of Adolescence on Monday. I think it was very powerful session which reinforced, yet again, the risks and threats of social media, particularly in that case with young boys, young children, young people.
Of course, we have to act in the national interest, but it’s also in the national interest to make sure our young people are safe when they’re online.
Starmer does not address the second point of the question – about the digital services tax being revised.
Photograph: Cameron Smith/Getty Images
At the Labour local elections launch, Keir Starmer is taking questions.
Q: Do you think other countries, like the EU, should adopt the UK’s approach, and not rush into retaliatory tariffs?
Starmer says in his experience it is not a good idea to go around telling other countries what they should do.
Reynolds says ‘no country in world further advanced in talks with US’ on new economic deal
Ben Obese-Jecty (Con) asks Reynolds how long he thinks it will take to negotiate an economic agreement with the US.
Reynolds says he shadowed a lot of Tory business secretaries, and some of them made promises on trade negotations. He says that was a mistake, because it means you are under pressure to agree a deal regardless of whether it is a good one.
But he says there is “no country in the world further advanced in the talks they having with the United States”.
Alison Griffiths (Con) claims Reynolds “dithered” for five months before meeting his US counterparts.
Reynolds says Griffiths is wrong, and he urges her to be more serious. He says he met his opposite numbers on many occasions, even before the formal processes had not started.
Stella Creasy (Lab) mocks the Tories for suggesting there has been a Brexit bonus.
Celebrating a tariff of 10%, rather than 20%, is like celebrating that when you got mugged, they only took your wallet, and not your watch as well.
She asks what the implication of this is for the reset negotations with the EU.
Reynolds says the government does not believe it has to make a choice between the US and the EU.
Steve Barclay, a former Tory cabinet minister, asks what the government thinks the cost of the tariffs will be to the UK.
Reynolds says the government is working on this.
And he says, as well as a direct impact, there will be a direct impact.
He says he will keep Barclay and other MPs informed on what the assessment is.
Reynolds accepts that the tariffs will create problems for Nothern Ireland if the EU imposes retaliatory tariffs.
He says there is a duty reimbursement scheme which means that, if US imports to Northern Ireland are subject to new EU tariffs, importers can get the cost reimbursed of the goods are not entering the wider EU market. But it will be important to make sure that scheme works, he says.
In his response to Griffith, Reynolds accused the shadow business secretary of being “flippant”.
He said that, although Griffith said the UK was getting the same tariffs as places like the Christmas Islands, the UK has a much more complex trading relationship with the US.
And, on Brexit, he said the Tories should remember that that was “perhaps not the finest hour in terms of the state’s preparation for large trade shocks”.
Tories mock suggestion UK was getting ‘special favours’ from US
Andrew Griffith, the shadow business secretary, responded to Jonathan Reynolds. The cross-party tone adopted by the Conservatives when Kemi Badenoch was tweeting (see 11.29am) did not last long. Griffith said that Tories would “support the government where it acts in the national interest”, but mostly his speech was highly critical.
This is also a moment for honesty and telling the truth. The government, sadly got no special favours from the White House last night. The secretary of state refers to vindication. This is no vindication at all. We’re in precisely the same band as the Congo, Costa Rica, Kosovo and the Christmas islands. In fact, I count over 125 countries and territories that have the same tariff levels as the US as we now do so not that special.
Last night was a vindication of those who were pilloried and abused for wanting our country to have the freedom to decide our own trade policy. If Labour and the Liberal Democrats had their way, we’d still be in the EU. As the prime minister acknowledged, this morning, thousands of British jobs have been saved today as the result.
