If the US genuinely tries to close its overall deficit with big tariffs all round, it will cause a crunching recession. If Trump discriminates between trading partners, the heavily tariffed ones can nip through the side door of those who escaped more lightly.

Donald Trump’s tariffs are a headache for all his trade partners. But the U.S. president’s plan to impose ad hoc “reciprocal” levies on imports are a particular problem for the European Union. By enabling him to target whichever countries in the bloc he pleases,

Including VAT s in reciprocity would lead to hefty increases in tariffs. Goldman Sachs, a bank, says that if America adopted only mirror-image tariffs without retaliation, its levies would rise by an average of two percentage points. Many European vat rates exceed 20%.