President Donald Trump announced on July 12 that the US will impose a 30% tariff on goods from the European Union and Mexico, starting August 1. Trump shared the decision in letters to European Commission President Ursula von der Leyen and Mexico’s President Claudia Sheinbaum, which he posted on Truth Social.
He added that the EU could avoid the tariffs if the bloc—or companies within it—chose to build or manufacture their products in the US.
Trump is no stranger to enacting policies that spark controversy, and financial experts have been warning about the consequences of the escalating trade war on the national economy, potentially pushing the US toward a recession. But what exactly is a tariff, and why does Trump favor them so much?
Click through the following gallery to find out how the new tariffs may impact you.