EU to scrap tariffs on US goods to pave way for lower car duties
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The European Commission has proposed scrapping duties on imported U.S. industrial goods in exchange for lower U.S. tariffs on European cars, a central element of the trade agreement reached last month between the EU and the United States.
The proposal represents the EU’s first step towards implementing the framework deal announced on 27 July by U.S. President Donald Trump and European Commission President Ursula von der Leyen. Under the agreement, the EU accepted a broad 15% tariff on vehicles to avert a potentially damaging trade war.
As part of the arrangement, U.S. tariffs on European-built cars were reduced from 27.5% to 15% with effect from 1 August, coinciding with the introduction of the EU’s legislative proposal. While the deal defused tensions between the world’s two largest trading partners, it remains asymmetrical: Brussels is required to cut its duties and increase purchases of U.S. energy products, while Washington continues to levy tariffs on around 70% of EU exports.
Trump has frequently criticised the European Union, claiming in February that it was “formed to screw the United States,” and has often pointed to the U.S. merchandise trade deficit with the bloc, which reached $235 billion in 2024.
