News / EC ready to talk with US on tariffs – but a deal 'must be mutually beneficial'

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The European Commission (EC) is “ready to find mutually beneficial solutions” with the US amid ‘tit-for-tat’ tariff threats.

According to the commission, there is no “absolute” figure for average tariffs on EU-US trade, as “this calculation can be done in a variety of ways which produce quite varied results”. 

However, it estimated that, “considering the actual trade in goods between the EU and US in practice”, the average tariff rate on both sides is approximately 1%. 

According to EC data, the US collected some €7bn ($7.3bn) in tariffs on EU imports in 2023, and the EU collected approximately €3bn on imports from the US – total bilateral trade in goods that year reached €85bn. 

“The EU exported €503bn of goods to the US market, while importing €347bn; this resulted in a goods trade surplus of €157bn for the EU,” said the EC.  

But when it comes to services, the EU has a trade deficit with the US, which records a surplus of €109bn. 

But when both goods and services are taken into account, the EU surplus with the US is €48bn – the equivalent of just 3% of the total €1.6trn EU-US trade. 

“In this sense, our economies complement each other very well,” said the EC.  

The EU has a 10% ‘most-favoured nation’ (MFN) tariff on car imports, compared with 2.5% in the US, but highlighted the US’s so-called ‘chicken tax’ of 25% on pick-up trucks – the largest segment of the American auto market, accounting for about one-third of all vehicle sales. 

“Tariff structures vary between economies, with some EU tariffs higher than those of the US and many others lower. Both the EU and the US have equally low tariffs overall,” it explained.  

The EC refers to VAT as a “trade measure”, rather than a tariff, and pointed to the similar sales taxes in the US. 

“It is applied on a non-discriminatory basis, regardless of where a product is made… EU-produced goods pay exactly the same VAT as any imported goods… It is clearly not a measure applied exclusively to foreign goods like an import tariff.” 

The EC said it remained committed to deepening transatlantic trade relations, and open to negotiations on tariffs.  

The Loadstar has reported how India has slashed tariffs for US automotive imports, but the EC has said any tariff reductions it makes “must be mutually beneficial and negotiated within a fair and rules-based framework”.