The United States has ignited a trade war by introducing a blanket minimum tariff of 10% on all imports, alongside specific tariffs aimed at its trading partners. These new tariffs are calculated based on a formula that primarily considers the trade deficit the U.S. holds with these countries. A graphical representation highlights the U.S. trade balance with its top 30 trading partners in 2024 juxtaposed against the recently announced tariffs, revealing a clear correlation. The details of the new tariffs reveal significant disparities. China, which accounts for the largest trade deficit for the U.S., will face the highest tariffs, with an increase from an existing 20% to a substantial 34%. Conversely, trade partners like Mexico and Canada will remain largely unaffected by this new wave, having already been subjected to a 25% tariff on most exports. The European Union is treated as a singular entity, receiving a uniform tariff rate of 20% across all 27 member states, irrespective of individual trade balances. ### The Five Unverifiable Rules for Tariff Determination The tariff calculation does not strictly adhere to the complex methodology purportedly established by Trump earlier this year, which stipulated five criteria for determining the applicable tariff for each nation. These criteria are broad enough to allow for a wide range of possible tariffs. The first criterion involves evaluating the taxes that each country currently imposes on American products. There is a tangible link between these taxes and Trump's tariff announcements. For instance, the United Kingdom had an average tax rate of 3.3% on U.S. products, which has now been raised to 10% under the new structure. The second criterion addresses any 'unfair, discriminatory, or extraterritorial taxes imposed on U.S. companies, workers, and consumers.' The U.S. government argues that certain countries impose taxes, such as VAT, which they perceive as unjust trade barriers. However, the new tariff structure does not appear to align straightforwardly with this reasoning; in fact, nations with higher taxes have sometimes received lower tariffs. For example, both India and Japan face similar tariffs around 25%, despite Japan imposing a significantly lower tax rate than India. The third criterion pertains to non-tariff barriers, including any unjust or harmful practices, such as subsidies or overly burdensome regulations for American businesses abroad. These measures are difficult to quantify, as the White House has not provided specifics regarding the practices in question. The final two criteria include vague references to currency manipulation, low wages, and any other practices deemed unfair or unethical. ### Methodological Approach Data for the trade balances referenced are sourced from the 2024 report by the U.S. Census Bureau. Tariff levels are based on average tariffs charged by each country against U.S. imports, as determined by the World Trade Organization. Furthermore, VAT figures are drawn from a report by PwC, while all other relevant data is obtained from Our World In Data. The tariff calculations and additional figures were derived from the information released by the White House. The countries discussed in this article are the top 30 trading partners of the United States.