For months, the UK government has insisted that striking an early trade deal with the Trump administration would give British exporters a competitive edge over the European Union. But when President Donald Trump imposed a fresh round of tariffs on 60 countries in July 2026 over alleged forced labour in supply chains, the numbers told a different story: the EU ended up with a slightly lower overall tariff burden than the UK.
The new US tariffs, announced by the Trump administration, place a minimum 10% levy on imports from countries that have not passed legislation mirroring America’s ban on products made with forced labour. The UK, like the EU, faces a headline 10% rate. However, the EU’s tariff is a flat rate applied across the board, while the UK’s 10% is applied on top of existing tariffs on specific goods such as footwear and textiles, raising the effective cost for some British exporters.
“Trump’s new tariffs hit UK goods, but the EU got lower rates — here’s why it matters for British exporters.”
According to BBC Economics editor Faisal Islam, the overall trade-weighted effective tariff rate for the EU could end up at around 8.5%, compared with 6.8% for the UK. That margin is narrow, but it means EU exporters now have a slight competitive advantage in the US market for certain goods. The British Chambers of Commerce trade expert William Bain pointed to sectors where EU companies can undercut British rivals.
Why did the EU get the better deal? The key difference is legislative. The EU has passed its own ban on forced labour goods, mirroring US law. The UK has not. The government said last October it “remained firmly opposed to the use of state-imposed forced labour” but was “considering how best to reflect this position”. That hesitation has cost it leverage. Trump’s forced labour justification is widely seen as a way to target China over conditions in Xinjiang, but it has also been used to pressure allies into adopting similar rules.
For UK readers, the stakes are practical. The US is the UK’s largest single export market, worth billions a year. While the government has struck side deals on medicines, steel, aluminium, cars and whisky — with help from King Charles on the latter — the overall tariff regime leaves UK exporters at a small but real disadvantage to EU competitors. Junior housing minister Sally Jameson insisted the UK is “in a better place today” because tariffs on whisky were removed, but the underlying structure remains less favourable.
Q: What exactly are the new US tariffs on the UK? The US has imposed a 10% import tariff on UK goods, justified by claims that the UK has not done enough to prevent forced labour in its supply chains. This is applied on top of existing tariffs on certain products like footwear and textiles.
Q: Why did the EU get a better tariff rate than the UK? The EU passed a ban on forced labour imports that mirrors US law, so its 10% tariff is a flat rate with no additional levies on specific goods. The UK lacks such legislation, so its 10% tariff stacks on top of other duties, making the overall cost higher for some items.
Q: What does this mean for UK businesses and consumers? UK exporters to the US now face higher costs than EU rivals in certain sectors, potentially making their goods less competitive. This could affect jobs and investment in UK manufacturing. Consumers may not see immediate price rises, but the long-term effect could be reduced export revenue and economic growth.
What happens next depends on whether the UK government follows the EU’s lead and passes a forced labour ban. The government has said it is considering the move, and doing so could open the door to renegotiating a better deal. With Trump’s trade war now entering a new phase — described by the Financial Times as a shift “from shakedown to lock-in” — the UK may need to act quickly to avoid being left behind.