Reciprocal Tariffs
Concept and US Trade Policy History
A "reciprocal tariff" is a tariff designed to match the rate charged by a trading partner — a form of tit-for-tat trade policy. The theoretical basis is "tariff reciprocity," used in WTO negotiations where countries exchange tariff concessions. However, President Trump's "Liberation Day" use of reciprocal tariffs departs from this framework: the US calculated partner tariff rates using a formula based on trade deficit magnitude rather than actual tariff comparisons, drawing criticism for methodological flaws. Historically, the US has used the International Emergency Economic Powers Act (IEEPA) and Section 301 of the Trade Act of 1974 to impose unilateral tariffs outside the WTO framework.
- US average MFN tariff on all goods: ~3.4% (one of the world's lowest)
- India's average MFN tariff: ~12–13% (among the higher G20 averages)
- Trump's first term (2018–2019): Section 232 steel/aluminium tariffs + Section 301 China tariffs of 25%
- WTO dispute: unilateral US tariffs technically violate GATT Article I (MFN) and Article II (bound rates), but US invokes national security exceptions
- US Supreme Court struck down earlier "Liberation Day" tariff attempt in February 2026; revised tariffs re-imposed under separate statutory authority
● Tracked since February 21, 2026 · last seen April 02, 2026 · updates as the daily brief publishes