The trade war between the European Union and the United States is escalating significantly after the European Commission announced retaliatory measures against the comprehensive tariffs imposed by US President Donald Trump on steel and aluminum products, which took effect Wednesday morning.
The Commission has declared that beginning April 1, a temporary directive will come into force, effectively increasing taxation on trade transactions with the US. This involves imposing additional taxes on transactions amounting to 26 billion euros ($7.3 billion), meaning US importers will need to pay up to six billion euros in additional import tariffs. Furthermore, the European Union is considering implementing a series of tax levies on numerous other products imported from the US.
This strategic move aims to signal to President Trump that damaging Europe's economy through product taxation will trigger a counterresponse that will harm the US economy in return.
Significant price increases expected
While Trump's primary intention is to protect steel and aluminum producers in the US, and the measure he is implementing is part of an economic battle mainly directed against Canada, the blanket tax now in effect without "special exemptions" will substantially impact Europe as well. This will lead to an increase from 10% to 25% in tax payments on various metal and steel products imported from Europe to the US.
The volume of trade in these products is valued at 26 billion euros, constituting only 5% of the total trade between the European Union and the US. However, the tax increase is expected to cause significant price increases across a wide spectrum of products, including vehicles, construction materials, various household items, and even retail sector goods – costs that will ultimately affect every citizen's pocket.
This trade conflict emerges at a particularly challenging time when many European Union countries are already struggling with economic difficulties and Europe requires financial resources. This situation is compounded by the European Union's decision to redirect significant funds toward strengthening the Union's military capabilities and massive armament programs in response to the security threat posed by Russia.
In an official statement, the European Commission announced that the European Union will implement regulations classified as "rebalancing measures" – mechanisms previously activated during the former Trump administration, which similarly raised taxes on certain sectors.
"On 10 February 2025, the US announced that it would impose 25% tariffs on imports of steel and aluminium and derivative products. In response to the imposition of new, unjustified US tariffs, the Commission has launched swift and proportionate countermeasures on US imports into the EU. The Commission's response is carefully calibrated, based on a two-step approach: the suspension of existing 2018 and 2020 countermeasuresagainst the US to lapse on 1 April, a package of new countermeasures on US exports. They will come into force by mid-April, following consultation of Member States and stakeholders."
Union officials noted that over the next two weeks, immediate discussions will be held regarding the series of "balancing measures" imposed. On March 26, another high-level meeting will convene with senior officials from all 27 European Union member states to discuss additional countermeasures. This comes despite the Union's warnings that it may adopt new laws by mid-April that would further increase taxation on trade relations between the EU and the United States.
"Open to meaningful dialogue"
The mutual imposition of taxes represents another burden on the already deteriorating relations between the European Union and the US. This tension is further complicated by disagreements over the American position regarding Russia's war in Ukraine and the Trump administration's demand for Europe to invest substantially more financial resources in its own security while reducing its security dependence on the US.
Commission President Ursula von der Leyen issued a special statement Wednesday morning saying, "The trade relations between the European Union and the US are the biggest in the world. They have brought prosperity and security to millions of people, and trade has created millions of jobs on both sides of the Atlantic."
Addressing the implementation of the tariffs, she stated: "We deeply regret this measure. Tariffs are taxes. They are bad for business, and even worse for consumers. These tariffs are disrupting supply chains. They bring uncertainty for the economy. Jobs are at stake. Prices will go up. In Europe and in the United States."
She further emphasized that the Union will take action to protect consumers and businesses. "The countermeasures we take today are strong but proportionate. As the US are applying tariffs worth 28 billion dollars, we are responding with countermeasures worth €26 billion. This matches the economic scope of the US tariffs. ur countermeasures will be introduced in two steps. Starting with 1 April and fully in place as of 13 April. In the meantime, we will always remain open to negotiation.
"We firmly believe that in a world fraught with geopolitical and economic uncertainties, it is not in our common interest to burden our economies with tariffs. We are ready to engage in meaningful dialogue. I have entrusted Trade Commissioner Maroš Šefčovič to resume his talks to explore better solutions with the US."
