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    Trump Pitches External Revenue Service to Collect Tariffs: What to Know

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    President Trump has promised to generate a “massive” amount of revenue with tariffs on foreign products, an amount so big that the president said he would create a new agency — the External Revenue Service — to handle collecting the money.“Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens,” Mr. Trump said on Monday in his inaugural address, where he reiterated a promise to create the agency. “It will be massive amounts of money pouring into our Treasury coming from foreign sources.”Much about the new agency remains unclear, including how it would differ from the government’s current operations. Trade experts said that, despite the name “external,” the bulk of tariff revenue would continue to be collected from U.S. businesses that import products.Here’s what you need to know about what Mr. Trump has proposed.The U.S. has an established system for collecting tariffs.Tariff revenue is currently collected by U.S. Customs and Border Protection, which monitors the goods and the people that come into the United States through hundreds of airports and land crossings.This has been the case nearly since the country’s inception. Congress established the Customs Service in 1789 as part of the Treasury Department, and for roughly a century tariffs were the primary source of government revenue, counted in stately customs houses that still stand in most major cities throughout the United States, said John Foote, a customs lawyer at Kelley, Drye and Warren.With the creation of the income tax in 1913, tariffs became a minor source of government revenue, and after the Sept. 11 attacks, the customs bureau was moved from the Treasury Department to the Department of Homeland Security.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 163 Shares189 Views

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    Trump Holds Off on Tariffs, but Paves the Way for Future Trade Action

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    President Trump will stop short of immediately imposing tariffs on imported products on Monday, but will issue an executive order directing federal agencies to begin studying a broad list of trade issues that could ultimately result in taxes on goods from China, Canada, Mexico and other countries in the coming months.The decision suggests that Mr. Trump is taking a more measured approach to fulfilling a key campaign promise of using tariffs to reorder America’s trading relationships. It will also delay — at least for now — fights that have been brewing with foreign governments, which have promised to answer Mr. Trump’s levies with tariffs of their own.The topics Mr. Trump will direct his officials to investigate in an executive order Monday will be extensive, including trade deficits and trade deals signed with China, Canada and Mexico. That could tee up the ability of the president to deploy tariffs on numerous targets for many different reasons, potentially scrambling international supply chains and spawning global trade wars in the weeks and months to come.The executive order will direct federal agencies to examine unfair trade and currency practices and to assess whether foreign governments have complied with terms of the two trade deals Mr. Trump signed in his first presidency. It will also require the government to assess the feasibility of creating an “External Revenue Service” to collect tariffs and dutiesMr. Trump is also ordering a study of tariffs that the United States has imposed for national security reasons, as well as the use of a special trade exemption, called de minimis, that allows low-value goods to come into the United States tariff free. That loophole has allowed large volumes of Chinese goods to escape the tariffs Mr. Trump slapped on China during his first term. The details of the executive order were earlier reported by The Wall Street Journal.While Mr. Trump has decided to hold off on tariffs for now, his advisers say he remains more convinced than ever that they can be used to great advantage.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 138 Shares169 Views

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    Chinese Companies Have Sidestepped Trump’s Tariffs. They Could Do It Again.

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    The companies have found plenty of new channels to the U.S. market — demonstrating the potential limits of the tariffs Donald Trump has promised to impose.After President Donald J. Trump slapped tariffs on Chinese bicycles in 2018, Arnold Kamler, then the chief executive of the bike maker Kent International, saw a curious trend play out in the bicycle industry.Chinese bicycle factories moved their final manufacturing and assembly operations out of China, setting up new facilities in Taiwan, Vietnam, Malaysia, Cambodia and India. Using parts mostly from China, those companies made bicycles that they could export directly to the United States — without paying the 25 percent tariff had the bike been shipped straight from China.“The net effect of what’s going on with these tariffs is that Chinese factories in China are setting up Chinese factories in other countries,” said Mr. Kamler, whose company imports some bicycles from China and makes others at a South Carolina factory.Pushing those factories into other countries resulted in additional costs for companies and consumers, without increasing the amount of manufacturing in the United States, Mr. Kamler said. He said he had been forced to raise his prices several times as a result of the tariffs.“There’s no real gain here,” said Mr. Kamler, whose bikes are sold at Walmart and other retailers. “It’s very inflationary.”Arnold Kamler said he had to raise prices at Kent International several times as a result of President Donald J. Trump’s 2018 tariffs.Kate Thornton for The New York TimesWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Trump’s Tariff Threat Pits Canada Against Mexico

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    If President-elect Donald J. Trump’s threat of hefty tariffs on Canada and Mexico was intended as a divide-and-conquer strategy, early signs show that it might be working.After his missive on Monday, in which he said he planned to impose a 25 percent tariff on all imports from both of the United States’ neighbors, Ottawa and Mexico City followed starkly different approaches.Mexico took a tough stance, threatening to retaliate with its own tariffs on U.S. goods. Canada, instead, emphasized that it was much closer aligned to the United States than Mexico.The trade agreement between the three North American nations has been carefully maintained over the past three decades through a delicate balance between the United States and its two key allies.As Mr. Trump prepares to take office, his willingness to tear that up to pressure the two countries on migration could open the door to the United States-Mexico-Canada agreement being replaced by separate bilateral deals with the United States.Chrystia Freeland, Canada’s finance minister, has tried to show that Canada is aligned with Mr. Trump’s hawkish attitude toward China.Blair Gable/ReutersWe are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 113 Shares139 Views

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    Tariff Threats Show Trump’s Commitment to Upending Global Trade

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    The president-elect’s threat to hit Canada, Mexico and China with new tariffs is already rocking business and diplomatic relationships and could topple the trade pacts he signed in his first term.President-elect Donald J. Trump’s threats to impose damaging tariffs on Canada, Mexico and China may ultimately be an opening wager to try to use the power of the American market to persuade other countries to stem a flow of drugs and migrants across U.S. borders.But even if the threat to impose vast tariffs on some of the world’s largest economies is a negotiating tactic, it is also a gambit that has immediate real-world consequences.Before Mr. Trump even sets foot in the Oval Office, his threat to put tariffs on America’s three largest trading partners on his first day in office was reverberating around the world, shocking international businesses, rocking diplomatic relationships and calling into question two big trade deals that Mr. Trump negotiated during his first term.Mr. Trump’s pronouncement late Monday that he would impose a 25 percent tariff on all goods from Canada and Mexico and a 10 percent tariff on products from China was immediately denounced by business groups, who said such a move would cause economic harm. Foreign officials rushed to reassure the incoming Trump administration that they had been working to stop drugs and migrants from coming into the United States — while warning that they were also ready to turn around and impose their own tariffs on American exports.Mr. Trump’s threats may have been intended to silence investors and economists who have recently questioned whether the president-elect would go through with imposing the big levies he promised while campaigning. In the run-up to the election, Mr. Trump pledged to put a 60 percent tariff on goods from China and a tax of at least 10 percent on all other imports. Such a move could ignite a global trade war, slowing economies around the world.Whether Mr. Trump’s threats ultimately show his prowess as a deal-maker or simply sow chaos, they are a reminder that the president-elect is eager to upend global relationships to try to secure points for the United States. That includes a willingness to potentially topple the trade pacts that he himself worked to put in place with Mexico, Canada and China during his first term after he used bruising tariffs to force them into making concessions.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Mexican President Mulls Retaliatory Tariffs After Trump’s Threats

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    Mexico’s president, Claudia Sheinbaum, hit back on Tuesday morning at President-elect Trump’s vow to impose 25 percent tariffs on all products coming into the United States from Mexico, signaling that her country was prepared to respond with retaliatory tariffs of its own.Ms. Sheinbaum also said that raising tariffs would fail to curb illegal migration or the consumption of illicit drugs in the United States, an argument that Mr. Trump had made in his warning on tariffs.“The best path is dialogue,” Ms. Sheinbaum said at her daily news conference, calling for negotiations with the incoming Trump administration while laying out steps that Mexico has already taken to assuage some of Mr. Trump’s concerns.Ms. Sheinbaum, reading from a letter she is planning to send to Mr. Trump, noted that illegal crossings at the border between Mexico and the United States had plunged from December 2023 to November 2024, largely as a result of Mexico’s own efforts to stem migration flows within its own territory.“Migrant caravans no longer reach the border,” she added.Ms. Sheinbaum also called on U.S. authorities to do more to address the root causes of migration.“Allocating even a fraction of what the United States spends on warfare toward peace building and development would address the deeper drivers of migration,” Ms. Sheinbaum wrote in the letter.Ms. Sheinbaum also raised the specter of a broader tariff war that could inflict damage on the economies of both nations, pointing to multinational car manufacturers like General Motors, Stellantis and Ford Motor Co., which have operated in Mexico for decades.“Why endanger them with tariffs that would harm both nations?” Ms. Sheinbaum wrote. “Any tariffs imposed by one side would likely prompt retaliatory tariffs, leading to risks for joint enterprises.”Mexico is far more dependent on trade with the United States than vice versa, exporting about 80 percent of its goods to its northern neighbor.But numerous sectors in the United States, such as semiconductor and chemicals manufacturers, also rely on exporting to Mexico. Exports to Mexico accounted for nearly 16 percent of overall American exports in 2022.Ms. Sheinbaum also said that Mexico was already taking steps to combat the smuggling of fentanyl to the United States. But she argued that the core problem was demand for fentanyl within the United States, calling the crisis “fundamentally a public health and consumption issue within your society.”“It is widely known that the chemical precursors used to produce fentanyl and other synthetic drugs are illegally entering Canada, the United States, and Mexico from Asian countries,” Ms. Sheinbaum wrote. “This underscores the urgent need for international collaboration.” More

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    Trump Plans Tariffs on Canada, China and Mexico That Could Cripple Trade

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    President-elect Donald J. Trump said on Monday that he would impose tariffs on all products coming into the United States from Canada, Mexico and China on his first day in office, a move that would scramble global supply chains and impose heavy costs on companies that rely on doing business with some of the world’s largest economies.In a post on Truth Social, Mr. Trump mentioned a caravan of migrants making its way to the United States from Mexico, and said he would use an executive order to levy a 25 percent tariff on goods from Canada and Mexico until drugs and migrants stopped coming over the border.“This Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!” the president-elect wrote.“Both Mexico and Canada have the absolute right and power to easily solve this long simmering problem,” he added. “We hereby demand that they use this power, and until such time that they do, it is time for them to pay a very big price!”In a separate post, Mr. Trump also threatened an additional 10 percent tariff on all products from China, saying that the country was shipping illegal drugs to the United States.“Representatives of China told me that they would institute their maximum penalty, that of death, for any drug dealers caught doing this but, unfortunately, they never followed through,” he said.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

  • 125 Shares199 Views

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    Trump’s Tariffs Could Deal a Blow to Mexico’s Car Factories

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    Until a few years ago there was not much in this patch of desert 250 miles north of Mexico City but rattlesnakes, coyotes and cactus. Today, it is gleaming evidence of the country’s growing importance as an auto producer.In 2019, BMW completed a vast factory complex here, near the city of San Luis Potosí. As spotless and modern as any in Bavaria, the plant builds luxury sedans for the United States, Europe, China and dozens of other markets.San Luis Potosí is one of several Mexican cities that have become little Detroits, producing Volkswagens, Audis, Mercedes, Fords, Nissans and Chevrolets. In the first nine months of this year, Mexican factories produced more than three million vehicles, of which two million were exported to the United States, according to the Mexican Automobile Industry Association.But Mexico’s pivotal role in the global auto industry is now at risk. President-elect Donald J. Trump has threatened to impose punitive tariffs of 100 percent or higher on cars from Mexico, which would violate a trade agreement his first administration negotiated with Canada and Mexico.The BMW factory in San Luis Potosí has 3,700 employees.Bénédicte Desrus for The New York TimesThe consequences for the auto industry would be profound, affecting the price in the United States of popular models like Ford Maverick pickups, Chevrolet Equinox sport-utility vehicles and several variations of Ram trucks.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More