Trumponomics: What Trump's tariffs mean for UK small businesses

Donald Trump's 2025 tariff measures are reshaping trade between the UK and US trade. A 10% baseline tariff now applies to most UK goods, with 25% on cars, steel and aluminium.

A separate move sees the end of the $800 de minimis threshold for low-value parcels into the US from 29 August 2025, becoming permanent on 1 July 2027.

For small firms selling into America, this changes price points, margins, paperwork and cash flow in one go.

What small businesses are saying

Surveys point the same way. Fifty-six per cent of SME owners say US tariffs have reduced their willingness to export, with one in seven firms that aren't yet exporting citing tariffs as the top barrier.

Separately, three in 10 firms estimate tariff knock-on costs of £10,000 to £20,000 this year and an average hit of £17,000 per business.

As the Federation of Small Businesses puts it:

"They are dealing with a falling demand for their goods and have had to cut their range – something that's turning what should be growth into damage control."

If you sell low-value parcels to US consumers

From 29 August 2025, the US ends the $800 de minimis threshold for low-value parcels. Every parcel will attract duty, based on the product and its origin.

The change becomes permanent on 1 July 2027. If you sell small basket sizes, be sure to model your landed costs now, then update your pricing, delivery terms and returns before the switch-over.

What to do this week

• Map your Harmonized System (HS) codes: Confirm which lines face 10% versus 25% and update pricing files.

• Re-price US e-commerce baskets: Model landed costs for orders below $800, include duty at checkout and refresh your returns policy.

• Ask your carrier or broker about cash flow easements: Look at customs warehousing, freeports and similar tools to defer duty.

• Set a US/EU price list with FX contingencies: Build tariff and currency buffers into RRP rather than absorbing volatility.

• Brief customers early: Explain fulfilment and pricing changes to protect conversion when duties apply.

Opportunity and competition

There's a live debate about whether the UK – which has agreements with both the US and EU – could attract EU firms seeking lower-tariff routes into America.

As Aman Parmar of BizSpace argues, this might help the UK reclaim some trade and investment lost after Brexit. For UK SMEs, that would bring supply-chain opportunities and tougher competition in price-sensitive segments.

Enterprise Nation's view

Tariffs are decided in Washington, but the UK can decide whether small exporters face them alone.

We want the government to blunt the impact of US tariffs by backing first-time and scaling exporters. Here's what we're asking for in the next fiscal events:

• A reinstated and enhanced UK Tradeshow Programme, so small firms can win customers in alternative growth markets.

• A fully resourced UK Export Finance, to hit the 2029 target of supporting 1,000 SMEs per year on fair terms.

• Export tax credits or vouchers, to de-risk early export investment for micro and small firms.

• A consistent pro-free-trade stance across international forums.

Final thoughts

Don't panic – prepare. Price for duty, fix the paperwork and diversify markets where it makes sense. And to government, help small exporters bridge this period with practical support that keeps them competitive.

A note on sources

This blog reflects publicly reported measures and sector commentary. Specific outcomes vary by HS code and supply chain, so treat all figures as indicative and check your product classifications before committing.

People also viewed

• Why scrapping the de minimis threshold is "another kick in the shins" for small businesses

• Government's new UK trade strategy: Enterprise Nation's recommendations

• Lunch and Learn: Navigating the new trade tariffs