The Union of European Socialist Republics (UESR - not to be confused with the defunct USovietSR) decides how to impose even higher tariffs against the US.
From the YCMTSU files (You cannot make this shit up) - the EU is drawing up retaliatory measures against the “Trump tariffs”.
From here:
EU ‘prepared’ to retaliate against Trump’s 20 percent tariffs – POLITICO
“European Commission President Ursula von der Leyen on Thursday slammed U.S. President Donald Trump’s imposition of a 20 percent tariff on EU goods and vowed to retaliate, saying the bloc was "prepared to respond."
“Von der Leyen said Trump’s tariffs would have dire consequences for consumers and businesses that have prospered through trade with the United States since World War Two. The European Union, the world’s largest single market, must also defend itself against profound disruptions to global commerce that would result from Trump’s isolation of the United States.”
Recall that the UESR is a customs union and that it seeks to impose its ridiculous “green” agenda on the entire world.
(100) EU rewrites every trade deal it has with the entire world via its new compliance directive
Qatar has shown the way to respond:
The hypocrisy is breathtaking.
The UESR has levied tariffs on US goods and services for decades and as soon as Trump reciprocates the EU seeks to increase customs tariffs and trade barriers!
The chosen method the EU uses to impose tariffs, is something called a Value Added Tax (VAT) that taxes every stage of the supply chain via VAT inputs and outputs. VAT is a regressive tax that collects taxes that the poorest in the EU would otherwise not pay in income tax.
The countries in the EU charge different rates p of VAT and give a few exemptions. The average cat is around 20%.
The rate of VAT is around the same 20% rate that has been levied on EU imports and works like this for all goods and services produced inside and outside the EU.
Imagine a supply chain of 4 stages.
Raw material costs 100 and company A in the supply chain turns that into “work in progress”.
Company A pays 20% VAT for the raw materials, paying 120, adds 50% to the value for the “work in progress” and sells it to Company B for 160 plus VAT of 32.
Company A has VAT inputs of 20 and VAT outputs of 32 - it has collected VAT for the government of a net 12 and paid the raw material supplier VAT of 20.
Company B refines the “work in progress” into a finished product and sells it to the consumer for 300 plus 60 VAT. It has paid Company A, VAT of 32 and has charged the consumer VAT of 60.
Company B has VAT inputs of 32 and VAT outputs of 60. The consumer pays the final VAT output of 60.
Using his device - VAT - the EU countries collect tax that the poorest in society would otherwise avoid - a transaction tax. The UK adopt this method when it joined the EU and cannot rid itself of the regressive nature after it left. UK VAT now gamers as much tax as income taxes.
Simply put. VAT acts as the current trade barrier and the US has reciprocated. The EU cannot use this VAT device and must invent another and separate tax in order to “reciprocate” US tariffs.
Here’s an example (h/t John Leake) from here:
“Mercedes CLE 450 costs 95,000 Euro in Austria - US$102,600 at one euro = 1.08 us$
Mercedes CLE 450 costs US$ 67,500 in the US.
Corvette Stingray C8Z06 In the US - $115,000
Price in Austria - 350,000 Euros or US$ 378,000.
Maybe that’s an extreme example, but it highlights the existing price discrepancies from the tariffs imposed by a European country - Austria - on US imports that the equivale of Stalin of he old USSR is going to worsen via “retaliatory” measures that are in fact “doubling down” on trade malpractice!.
Every export and import of every product and service need to be evaluated against the existing tariffs already imposed by the UESR on the USA and a separate charge levied - one that is distinct from the existing tariffs.
The UESR would not raise VAT to 25% or 30%, surely not!
Good luck with that!
Please take a subscription to gain access to the thousands of hours of research that go into producing these SubStack articles - or make a donation of $3 bucks or more for a ko-fi here:
Onwards!!!