The Financial Impact of Us Tariffs on UK Businesses

All businesses operating in US markets and exporting goods to the US will see operating costs substantially increase due to a blanket tariff on all imported foreign goods, excluding a handful of sectors, including aerospace, electronics, aluminium, and steel.

The automotive industry must stomach heavy fees as a 10% tariff is applied on the first 100,000 vehicle exports from the UK and 27.5% thereafter. The UK imports around 100,000 vehicles from the US each year, with many British-born car manufacturers reliant on US markets.

The US tariffs were introduced to increase competition between American manufacturers, revive the American economy, raise taxes and overhaul historic trade policies.

As British businesses see operating costs increase due to US tariffs and higher Employers’ National Insurance Contributions, National Living Wage, energy bills, and interest, their long-term viability must be carefully tracked. UK SMEs must consider ways to absorb the price increase or mitigate the impact, at the same time new tax rules come into play.

This may involve streamlining service lines, revising employee numbers, reviewing supply chains, and restructuring company operations. If the risk of insolvency is unmanaged, financial health will rapidly decline, so the earlier professional insolvency advice is sought, the earlier a remedy can be actioned.