Trump's tariffs stay at 10% for now, but uncertainty looms

Businesses in the UK and the EU will be spared the threatened 15% tariff increase President Trump announced at the weekend.

That followed a US Supreme Court ruling that his global tariff plan was illegal under the International Emergency Economic Powers Act (IEEPA).

The Department for Business and Trade (DBT) has confirmed the rate is currently set at 10%, but it's clear there's no understanding of when – or if – the 15% would be applied.

According to an analysis by the global think tank Global Trade Alert, the new positioning could see UK businesses worse off than most other nations if the 15% tariff goes ahead.

It claims the move would be favourable for firms that export to the US in China, Brazil and India.

But, ironically, firms in the UK, Italy and Singapore that have pre-existing low tariff agreements would end up paying more.

Business secretary Peter Kyle told a Parliamentary committee he "could say with some confidence" that UK's trade agreement with the US would stand.

Where does this leave UK small businesses?

Tajinder Banwait MBE is the founder of Leicestershire-based Urban Apothecary London, which exports its range of home fragrances to 37 countries.

Her firm pulled back on its plans to export to the US last year when the de minimis threshold was removed. She says any uncertainty is unhelpful.

"Uncertainty is something most businesses are learning to live with, and the possibility of new tariffs is a reminder of how quickly trading conditions can change.

"We were preparing to expand into the US based on the de minimis threshold being in place. Then the duties were introduced, but with ambiguous guidance.

"At that point, it became difficult to tell customers what extra charges they could incur, and what return costs we'd face if customers didn't pay the duty.

"We've now put our plans to expand our direct-to-consumer offering via the website on hold. As a result, we're missing out on sales while we work towards the right long-term solution.

"We continue to receive daily enquiries from US customers wanting to place orders.

"And while it's difficult to step back when demand is there, it's important not to move forward without a solution that works for both the business and the customer."

Falling exports to the US

Tajinder's experience is a familiar one.

ONS data shows that UK goods exports to the US fell by £2 billion in April 2025, the largest monthly drop since records began in 1997. Cars, chemicals and metals led the fall.

A small recovery in October was wiped out by a 10.4% fall in November, but the latest ONS data for December 2025 shows a marginal 2.5% uptick.

However, the ONS itself warns that "the value of goods exports to the United States have remained relatively low since the introduction of tariffs in April."

The UK government's own UK-US trade factsheet shows UK goods exports to the US fell 6.5%, or £4.4 billion, in the year to Q3 2025 compared to the same period the previous year.

Services exports rose strongly over the same period. But according to the ONS Business Insights Survey, 34% of goods exporters reported that US tariffs were affecting them directly, with additional costs the most common impact.

Small businesses are being hit harder than big ones

The BCC's Q4 2025 Trade Confidence Outlook, surveying over 2,000 exporters, found that only 19% of SMEs had seen their export orders increase, compared to 39% of businesses with more than 250 employees.

Overall, 28% of all exporters reported a drop in orders in Q4.

The share of exporters reporting a decline is now double what it was in 2018, before Brexit, COVID-19 and tariffs compounded each other.

What your small business can do right now

Tajinder has some practical tips for exporting, and says it's still a great way to expand and grow a business.

• Get up-to-date guidance on tariffs and exporting from the Department for Business and Trade.

• Build flexibility into your supply chain early – alternative suppliers are far harder to find under pressure.

• Understand your cost structure in detail so you can model different scenarios realistically, including returns, hidden fees and increased tariffs.

• Avoid kneejerk reactions, as not every threat becomes a reality.

• Protect the integrity of your product and brand – unclear pricing can quickly erode trust.

• Stay close to your customers and communicate with them openly if changes arise.

People also read

• Tariff trouble: What Trump's new threat could cost UK small firms

• UK exports from 2000 to 2025: What changed and what it means for small firms

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