U.S. tariff plans on UK steel scrapped, leaving UK steel industry feeling let down
In a surprising turn of events, the UK Government has decided to pause its push to cut the 25% levy on steel exports to the US. This decision comes as a disappointment to the UK's steel industry, which had been hoping for a reduction in tariffs.
The move was made as part of the US-UK Economic Prosperity Deal signed on May 8, 2025. Despite the US increasing steel tariffs to 50% for other countries on June 4, 2025, Britain remains the only country to benefit from a 25% tariff on steel exports to the US. This exemption has been maintained, reinforcing Britain's position as a trusted source of high-quality steel.
The decision to keep tariffs at 25% instead of abolishing them has been met with dismay by the British Chambers of Commerce and the Liberal Democrats. The Liberal Democrats believe that ending President Trump's damaging trade war with Europe and the Commonwealth is the best way to protect the UK's economy.
The UK could have sought a small tariff-free quota for its steel exports to the US, but this would have left the rest exposed to the 50% US global tariff faced by other nations. Gareth Stace, Director-general of industry trade association UK Steel, stated that the final decision on 25% offers a degree of certainty and potentially a competitive advantage.
Andrew Griffith, Tory frontbencher, has demanded the Government to correct the record and reverse the decision not to pursue a further reduction in tariffs for the British steel industry. Liam Byrne, Labour chairman of the Commons Business and Trade Committee, warned the Government that Britain now trades with its biggest partner on terms that are worse than the past.
The US administration has prioritized the reduction of imports over its historic trading relationship with UK steelmakers. This has led to a deluge of heavily subsidized steel flooding into international markets, forcing countries across the world to erect trade barriers to protect their industries.
The Prime Minister has admitted that thousands of jobs will be lost due to the failure to secure a deal to reduce US steel tariffs. As the news was greeted with dismay by UK industry, given the earlier pledge to work towards a 0% rate, the Government spokesperson also mentions that they are continuing to work closely with the US to deliver certainty for UK industry, protect skilled jobs, and support economic growth.
In other news, the US President, Donald Trump, is expected to meet Sir Keir Starmer at the Prime Minister's country estate, Chequers, on Thursday. However, there are no public-facing engagements set for the president, with thousands expected to take part in major protests against his trip.
