US President Donald Trump said today he plans to impose “reciprocal taxes” on imports to reduce the US trade deficit – a move sure to ratchet up tensions with Washington’s trading partners.

“When a country Taxes our products coming in at, say, 50%, and we Tax the same product coming into our country at ZERO, not fair or smart,” Trump said on Twitter.

“We will soon be starting RECIPROCAL TAXES so that we will charge the same thing as they charge us. $800 Billion Trade Deficit-have no choice!”

The comments come one day after Trump announced he will impose steep tariffs on steel and aluminium next week, which already had prompted angry reaction at home and abroad – and threats of retaliation.

But taking the more drastic step of imposing reciprocal import tariffs on all goods and countries would eviscerate the rules-based global trading system.

In a tweet earlier today, Trump said “trade wars are good, and easy to win.”

Economists say such steps hurt American workers and industry including the important auto and defence sectors – key planks in Trump’s political base.

Rising import prices also would stoke inflation and crimp economic growth.

When former president George W. Bush imposed 30% tariffs on steel in 2002, one study estimates it cost 200,000 American jobs. Those tariffs were rescinded 18 months later when the US lost a dispute before the World Trade Organisation. – AFP, March 2, 2018.