good morning. The Labour Government reached a limited trade agreement with Donald Trump, ensuring reduced punitive tariffs on automobile and steel exports, but did not reverse the 10% collection applied to most goods. Some thoughts on broader politics below.
The calculations come
From a labor government perspective, the biggest and most important thing about the deal the UK government has reached with Donald Trump is offering considerable relief to Jaguar Land Rover from Trump’s tariffs. Perhaps the rest of the country will get a better deal by calming down later than the UK, or not at all, but the sharpest hit companies have received a reprieve from 25% tariffs on cars and metals previously set by the Trump administration.
According to the UK government, UK steel and aluminum exports will be rated zero at tariffs, but the first 100,000 British cars sold in the US each year (most of the total) will reduce their taxes by 10%.
The ghost of the East Feast here is the USMCA. This is the deal that Donald Trump attacked Canada and Mexico in his first term. Now he sees the deal as inadequate and pursues land that is offensive against both neighbors.
But the biggest problem with this deal from a UK perspective isn’t that Trump might revive it. The successful negotiations with Trump mean that the government is not in place to prepare UK taxpayers for further tax increases or spending cuts in November, which are essentially guaranteed to follow this year’s budget. Equally important, it means that they are not asking whether they launched a fire to obtain a transaction that includes drug relief or whether the government’s changes to “non-dom” taxation should be reconsidered.
Students aged 16-19 have been invited to join the FT Schools blog competition in collaboration with the Political Studies Association and Soutout UK by May 25th. If I’m based in the UK, the winner and two runner-ups will be participating in the Parliament event where I am the panelist. Details here.
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I’m going out to photograph to see the sinner. But you spend it and have a great weekend!
Today’s top stories
Give me your funds | A leading fund manager warned at a Downing Street meeting that sentiment towards the London stock market is in “Lockbottom,” urging the minister to consider mandating the UK pension fund to allocate at least 5% of its investment in domestic stocks.
Cars, Cattle, Crops | US and UK leaders welcomed the trade deal signed between the two sides as “historic” on Thursday, but experts warned that the UK faces higher tariffs on the US than before Donald Trump took office. This is the winner and the loser.
Warrington has a debt of £1.9 billion The minister sends a team of experts to the debt-risked Warrington Council after government inspectors warned that borrowing and investment strategies for that risk was being used to avoid “transformative” savings.
‘colleague . . . Let’s tear down on welfare” | Keir Starmer is warned that up to a quarter of his Congress party has raised concerns about cutting disability benefits, and so he is facing his biggest uprising, the Times reports. More than 80 Labour lawmakers have signed a private letter laying out concerns about the scale and pace of welfare cuts.
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