Tax Updates: April 14th 2025

As you are aware on 2 April 2025, US President Donald Trump announced the implementation of reciprocal tariffs to address the perceived emergency around the US trade deficit. Specifically, on 5 April a basic tariff at a rate of 10% was put into effect on imports into the US from almost all countries (with some exceptions for certain countries and goods). It was also announced that from 9 April onwards different reciprocal tariff rates ranging from 10-50% will apply to importations from certain countries, including the EU (with a 20% tariff rate), instead of the above-mentioned basic 10% tariff rate.

On 9 April, the European Commission announced that EU Member States voted in favour of its proposal to take trade countermeasures against the US following the imposition of tariffs on steel and aluminium imports from the EU. The European countermeasures were to enter into force once the Commission's internal procedures have been completed, with anticipated effective date the 15^th of April 2025.

However, on 9 April there was a further announcement from President Trump who announced a
90-day pause on the aforementioned country-specific reciprocal tariffs and shortly afterwards he also proceeded to (temporarily) exempt smartphones, computers and certain other electronic devices from reciprocal tariffs. European Commission President Ursula Von der Leyen, announced that in response to this pause by the US, European trade retaliation measures would also be suspended for 90 days in order to “give negotiations a chance”. However, she clarified that if negotiations do not succeed, the EU countermeasures will be implemented.

For further information in relation to the Country Reciprocal Tariff List, the Business Impacts of Tariffs and the Tax, Transfer Pricing and Supply Chain Considerations, please refer to relevant newsletter Reciprocal Tariffs Slipsheet and analytical presentation of KPMG US Tariff Mitigation Playbook.