Donald Trump drops EU pharmaceutical tax rate from 250% in deal

U.S. President Donald Trump backed off from setting high tariffs on drugs and semiconductors imported from the EU.

Last month, Trump said drugs and semiconductors were not covered by the United States and the European Union Handshake Trade Agreement – This means that the tariff rates for these sectors are 250% and 100% respectively.

However, EU pharmaceutical and semiconductor tariffs will be limited to 15%, in line with the consistency of most other sectors in the trade deal, according to new details about the U.S. EU agreement released Thursday.

However, the EU will first have to pass legislation to reduce U.S. export tariffs to zero, to reduce the 27.5% tariff on automobile exports to 15%.

The United States and the European Union said in a joint statement on the agreement that this is the “first step” in the process that can be expanded as the relationship develops.

The trade deal was first announced last month at a meeting between Scotland’s Trump and European Commission President Ursula von der Leyen.

They agree Reduce tariffs on most EU exports to 15%half of the initially threatened by Trump, but higher than the 10% tariffs the UK receives.

At the time, von der Leyen described it as a “framework” protocol and details were to be developed in the next few weeks.

But the threat of U.S. levy on drug and semiconductor exports has furthered concerns that these products will be excluded from the deal.

In July, Trump threatened to raise drug tariffs to 200%, but Trump said in a August 5 speech on CNBC that they could end up as high as 250%.

“We want medicines that are made in our country,” he Tell CNBC.

EU member state Ireland is the major drug exporter of the United States, like other European countries: Novo Nordisk, a physician manufacturer of Ozes, is also Europe, headquartered in Denmark.

On Thursday, Ireland’s Deputy Prime Minister and Foreign Minister Simon Harris welcomed the 15% interest rate including pharmaceuticals and semiconductors.

“This provides an important shield for Irish exporters who may be subject to greater tariffs,” he said. “Our intention now is to see what other carvings can be made in the areas of interest for Irish exporters.”

Under the joint agreement, the United States will apply a new 15% tariff rate on most European goods, including European semiconductor and wood exports, starting September 1.

In return, the EU will reduce tariffs to zero on “all American industrial supplies”, including fresh fruits and vegetables, pork, bison meat and tree nuts.

The agreement says only Europe eliminates tariffs on exports to the United States (a move that requires legislation) and the White House will reduce the tariffs on European car exports to 15%.

EU Trade Commissioner Maros Sefcovic said in a press conference that the deal stipulates that a 15% tariff on cars will be traced starting this month from the start of the legislative process.

Sefcovic said starting the process this month was a “firm intention” for the EU, and he was assured from the United States that lower tariffs would be filed from August 1.

European Commission President Ursula von der Leyen said the deal provides predictability for the group’s businesses and consumers, as well as “the stability of the world’s largest trading partnership”.

She provides this EU trade agreement for our citizens and companies and strengthens transatlantic relations. ” Said on X on Thursday.

U.S. Commerce Secretary Howard Lutnick said the deal “creates historical opportunities for American producers to the historic European market.”

“The United States’ first trade agenda has secured the most important trading partners and created significant victories for American workers, American industry and our national security,” he said. He wrote on x.

“Tariffs should be one of the favorite words in the United States.”

The deal was concluded after Trump’s tariff threats and fierce negotiations between the United States and the EU The first time was announced in April He will reach all European exports with a 30% tariff.

But the Atlantic Ocean was disappointed, with wine and spirits not yet able to manage to exempt the tariffs.

French wine exporters federation FEVS said it would “create major difficulties in the wine and spirits sectors”.

With wine and spirits, Mr. Sevkovic said, “Unfortunately, we have no success here”, although he added: “These doors are not closed forever.”

In the United States, the Distillation Spirit Committee also said the agreement was disappointing.

It said that without “permanent recovery of zero-to-zero spirit tariffs”, U.S. breweries would not be able to determine future growth, and higher tariffs on EU spirits would “further exacerbate the challenges facing restaurants and bars in the United States.”