Donald Trump tariffs and trade war with EU: Northern Ireland Protocol may impose EU taxes on US goods coming into NI

Ulster University Senior Economist Dr Esmond Birnie made the assertion as debate continues internationally about US President Donald Trump's controversial programme of adding tariffs (trade taxes) to many goods coming into the US from countries that he says are selling much more to America than they are buying from it.

(Tariffs are a government-imposed tax on imported or exported goods, to control trade and generate revenue.)

The EU has said it will impose counter-tariffs on £21.9bn worth of American goods in response to the US erecting 25% tariffs on all steel and aluminium imports.

It has been reported that because Northern Ireland remains in the EU Single Market after Brexit, the EU counter-tariffs will also apply to American goods coming into NI - while GB would be exempt as it is no longer in the EU single market.

Dr Birnie told the News Letter that the situation remains “highly uncertain” but that the EU's determination to guard the EU single market on the island of Ireland has been proven through the Northern Ireland Protocol and Windsor Framework.

This suggests, he said, that EU tariffs would indeed be applied to any US goods coming into NI - or that very strict controls would be required to keep them out.

"All this is highly uncertain but the precedent for strong EU concern about preserving the 'integrity' of their Single Market/Customs area is there - as evidenced by the Northern Ireland Protocol and the Windsor Framework," Dr Birnie said.

"That would imply either that NI would have to adopt any retaliatory tariffs which the EU places against US goods - or - some very intense system of checks would have to be imposed at the Irish Sea 'border' and/or the land border to ensure that any US origin goods were not 'leaking' on into the EU's 27 member states."

This would also apply to US goods coming to NI from GB, he added.

North Antrim TUV MP Jim Allister noted the EU has announced plans to retaliate to the US 25% tariffs on steel and aluminium imports with its own package of tariffs in April.

The EU says that the US tariffs constitute a $28 billion tax, and it is responding with a counter 26 billion euro tax on American ‘boats, bourbon and motorbikes’ he added.

“One of the absurdities arising from the EU dividing our country into two through their customs and international biosecurity border is the fact that our exporters and importers are also subject to the EU rather than the UK tariff regime,” Mr Allister said.

This already presented a challenge for NI businesses because they were already subject to EU and not UK tariffs, which are on average 3.8% and 5% respectively.

“However, the impact of the EU retaliation drives home yet again, much more starkly than before, how Northern Ireland has been cut off from the rest of our own country, and how we are now being subject, not just to legislation made by a foreign parliament that we did not elect, and cannot remove, but also the governance decisions of a foreign government we did not elect, and cannot remove."

However Dr Birnie added that most people are assuming that Prime Minister Keir Starmer will "work his magic" with Mr Trump and that GB will escape any US tariffs on its exports to America.

But it is worth noting, he added, that the US has already applied 25% tariffs on steel and that includes UK exports of steel.

British manufacturers have said the US tariffs will create “severe problems” and are a “big concern” while Sir Keir Starmer says the UK will keep open the option of “retaliatory measures”.

A UK Government spokesperson said: “Northern Ireland is part of the UK internal market and customs territory. Northern Ireland exporters will not be impacted by these new US tariffs any more than exporters from elsewhere in the UK. “We are looking closely at the retaliatory tariffs announced by the EU and any impact these might have on businesses. Under the Windsor Framework, where US imports into NI do not subsequently enter the EU, traders can reclaim any duties through the Duty Reimbursement Scheme.”