President Donald Trump has signed a memorandum instructing his administration to pursue reciprocal tariffs against nations that impose fees on U.S. exports, potentially sparking a trade war. The tariffs will mirror the fees other countries place on U.S. products, considering factors like tariffs, taxes, and regulatory requirements. Trump aims for a straightforward “whatever they charge, we charge” approach. Initially planning blanket tariffs on all nations, Trump now favors a more targeted reciprocal tariff strategy.

The process, led by key officials, will prioritize countries with high trade deficits and significant trade issues. The administration hopes these actions will prompt discussions with U.S. partners on trade barriers. Trump has already imposed steep penalties on steel and aluminum imports and plans to consider tariffs on automobiles, pharmaceuticals, and computer chips. These tariffs have drawn criticism from Democratic lawmakers and U.S. allies, who view them as counterproductive.

To assess the fiscal impacts, the White House has tasked OMB Director Russell Vought with submitting a report within 180 days. Trump’s push for reciprocal tariffs stems from his belief that other countries have taken advantage of the U.S. through trade deficits. With these actions, Trump seeks to emphasize reciprocity in trade relations. Since taking office, he has increased tariffs on China and announced tariffs on Mexico and Canada, which were later paused in exchange for concessions. The administration’s shift towards reciprocal tariffs reflects a more measured and strategic approach to trade policy.