President Donald Trump He announced that it would impose a 25 % tariff on imported cars. The White House claims that the step will increase local manufacturing, but others argue that it may strive to strive for the global supply chains.
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More details about the tariff for imported cars
As we mentioned, Trump told the correspondents on Wednesday (March 26) that the customs tariff is 25 % “You will continue to stimulate growth.” The White House expects to collect revenues of $ 100 billion annually from customs tariffs.
However, responses to this measure can be complex, so that American auto companies are the source of their parts from all over the world. The tax height, which begins on April 3, may mean high costs and lower sales. The definitions will be at the top of any taxes present, and apply to each of the imported cars and parts.
However, President Donald Trump argues that the customs tariff will lead to the opening of more factories in the United States and the end of what he calls the “funny” supply chain that includes auto parts and manufactured vehicles throughout the United States, Canada and Mexico. The Republican President also affirmed that a 25 % tariff is “permanent”.
On Monday, the President was killed by Hyundai’s plans in South Korea to build a 5.8 billion dollar steel factory in Louisiana. He pointed to this news as evidence that the customs tariff will restore manufacturing functions.
According to the Labor Statistics Office, more than a million people are used a little bit in the manufacture of cars and parts. This is about 320,000 less than 2000. An additional 2.1 million people work in cars and spare parts. The United States imported nearly 8 million light cars and trucks worth $ 244 billion last year. Mexico, Japan and South Korea were the supreme sources of foreign vehicles. According to the Ministry of Trade, the total imports of auto parts were more than $ 197 billion, led by Mexico, Canada and China.
Auto industry, Canada, Mexico and Europe interact with customs tariffs
according to Associated PressGeneral Motors fell almost 7 % in trading on Thursday. Ford share decreased about 4 %. The shares in Stellantis, the owner of Jeep and Chryler, decreased by 1.25 %. But stock prices for electric car makers Tesla and Rivien were rising.
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The US Automobile Policy Council, which represents local auto manufacturers, issued a statement on the imported tariff.
The council said: “It is important to implement definitions in a way that avoids raising prices for consumers, which maintains the competitiveness of the auto sector in North America integrated.”
The former head of the group, Matt Blant from Missouri, also sent an email to the Associated Press: “… We have clearly expressed their concerns about prices and other effects on the administration, as well as our belief that the modern trade agreement in North America must remain.”
Foreign leaders were quick to criticize definitions. “This is a very direct attack,” Canadian Prime Minister Mark Carney said.
“We will defend our workers. We will defend our companies. We will defend our country,” Carney added.
In Brussels, European Commission President Ursula von der Lin expressed his regret for the US decision to target car exports from Europe. Leyne has pledged that the bloc would protect consumers and companies.
“The definitions are taxes – bad for companies, and worse for consumers equally in the United States and the European Union,” she said in a statement.
Mexican President Claudia Shinbom said on Thursday that her country does not want to be attracted to positions with every new tariff. However, she said in light of the commercial agreement from Trump’s first state “There should be no tariff; this is the essence of the trade treaty.”
Meanwhile, President Donald Trump repeated his willingness to challenge the allies on the definitions. On Thursday, on social media, the current customs tariff planned in Canada could be “much greater” if the country cooperates with the European Union against the United States
Trump has already set an import tax by 20 % on all imports from China for its role in producing fentanel. Likewise, put 25 % of the customs tariff on Mexico and Canada, with a decrease in 10 % tax on Canadian energy products. Parts of the Mexico and Canada tariffs, including car taxes, were suspended after objecting to automobile companies. Trump, by granting them a 30 -day re -postponement, is scheduled to end in April. The president also imposed a 25 % tariff on all imports of steel and aluminum. It also plans to definitions on computer chips, pharmaceutical medications, wood and copper.
Will the cost of vehicles in the United States rise?
Trump has long said that definitions against imported cars will be a specific policy for his presidency. He stated that the costs created by taxes would lead to more production to the United States while helping to narrow the budget deficit.
However, American and foreign auto companies have factories all over the world to accommodate global sales while maintaining competitive prices. Moreover, it may take years for companies to design new and constructive factories and open them by Trump.
“We are looking at the prices of vehicles much higher,” said economist Mary Le Leijam to AP. “We will see a reduced choice … these types of taxes decrease dramatically on the middle and working class.”
She said that more families will be priced from the new auto market and they will have to stick to the blocking vehicles. The prices of medium vehicles are already about $ 49,000. If taxes are completely transferred to consumers, the average price of cars on a imported car can jump by $ 12,500, an amount that can feed on inflation in general. Keep in mind that one of the incentives for the Trump voter was his promise to reduce car prices.
When Trump announced the new definitions, he indicated that he wanted to provide a new incentive to help car buyers by allowing them to deduct federal income taxes paid on car loans. These privileges will only be for vehicles made in America. This discount will eat in some revenues that definitions can generate.
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The Associated Press Josh Bouak and Rob Gillis contributed to Toronto and economist AP Paul and Yazman in this report.
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