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A British Treasury minister has denied claims by Donald Trump that Sir Keir Starmer was “very happy” to see a 10 per cent tariff slapped on UK exports to the US.
James Murray said: “We are disappointed that global tariffs have been introduced. We know that they will have an impact on Britain and around the world.”
Trump told reporters on Air Force One he thought the UK prime minister was “very happy about how we treated them with tariffs”.
The UK was hit with the lowest baseline tariff, along with many other countries. The 10 per cent tariff was half the 20 per cent rate applied to the EU.
However, Starmer’s allies say the prime minister is acutely aware of the damage the US tariffs will inflict on the UK and the dangers that an escalating global trade war pose to the British economy.
Murray said Britain’s priority now was to negotiate a trade deal with Trump “at pace”. He told the BBC: “We want to see the additional tariffs removed.”
However, British officials admit that it will be tough to persuade the Trump administration to cut the baseline tariff below 10 per cent, although talks on a deal are continuing.
A key aim for British ministers is to cut the 25 per cent global tariff applied by the US to car exports — the automotive sector is one of the most directly exposed parts of the UK economy to the Trump tariffs.
“That is a particular concern to me,” business and trade secretary Jonathan Reynolds told MPs on Thursday. The IPPR think-tank estimated that 25,000 direct jobs in the car industry could be at risk, with employees at Jaguar Land Rover and Mini seen as most vulnerable.
While the UK’s car industry mainly exports to Europe, the US accounts for one in six models shipped abroad and is the largest market for high-end manufacturers such as JLR, Bentley and McLaren.
Reynolds has started a four week consultation with British business on possible retaliatory measures against the Trump tariffs, including targeted measures against selected products. However, Reynolds has made it clear that business does not want an escalation of a trade war.
Murray said on Friday: “Our response is to carry on with a cool head and a pragmatic approach to negotiate at pace a better deal.”
British negotiators, including Britain’s US ambassador Lord Peter Mandelson, are looking at scrapping or scaling back Britain’s digital services tax, which mainly affects US tech firms, along with other concessions, such as cutting tariffs on certain meat and seafood products.
The UK is also trying to secure a tech partnership with the US as part of a broader economic deal, including regulatory changes to facilitate transatlantic co-operation.
Reynolds has dismissed suggestions that American criticisms of free speech in Britain are part of trade negotiations and rejected the idea that the UK would water down its online safety laws to appease US tech firms.
“The talks I have had with my US counterparts are to do with goods, services, the regulation of professional bodies and all the things we would associate with normal trade talks,” Reynolds told MPs on Thursday.
“The United States is not seeking to make our children unsafe or more vulnerable. That is not the right approach to take to our key and core ally.”