The UK government has stated it will adopt a 'wait and see' approach following the announcement of tariffs by U.S. President Donald Trump.

On Thursday evening, Trump unveiled what he referred to as 'reciprocal tariffs' aimed at all nations, asserting the measure to be 'fair to all'.

However, the implications for the UK remain unclear, particularly concerning Trump's characterization of Value Added Tax (VAT) as a form of tariff.

Pat McFadden, Chancellor of the Duchy of Lancaster, emphasized the importance of not 'overreacting' to the announcement during an interview with Sky News.

He remarked, 'Sometimes tariffs are announced, a couple of days later, they are unannounced,' highlighting the fluid nature of trade policies.

In response to inquiries regarding the government's stance on Trump’s tariffs, McFadden stated, 'Wait and see what it means, it’s the best reaction to everything over the last month.' He acknowledged there are still significant questions regarding the extent of the tariffs.

McFadden further noted, 'We took the decision … that we wouldn’t breathlessly chase every headline coming out over the last month.

I think that’s the right decision.'

Trump's recent tariffs include a substantial 25% levy on steel imports announced earlier this week, along with tariffs imposed on Canada and Mexico, which were later suspended for thirty days amid ongoing negotiations.

Canada and Mexico, alongside the European Union, are preparing retaliatory tariffs should the duties take effect, while China has already enacted a 10% tariff on its exports to the U.S.

When pressed about the possibility of the UK retaliating against Trump's tariffs, McFadden deemed it 'premature' to discuss such actions, stating, 'That’s not the way you make policy.' He reiterated that the UK government’s fundamental responsibility is to act in the national interest, which includes maintaining strong trading relationships globally.

The tariffs introduced by Trump will not be enacted immediately.

The president has directed his advisors to conduct investigations into the trade practices of other countries prior to finalizing any specific measures.

The British Chambers of Commerce (BCC) has expressed concerns regarding the potential ramifications of Trump’s plans, warning that they could disrupt established trade norms and create additional cost and uncertainty for investors, businesses, and consumers worldwide.

William Bain, head of trade policy at the BCC, has cautioned the UK government against becoming embroiled in a 'trade war of tit-for-tat tariffs'.

Trade between the UK and the US is significant, valued at approximately £300 billion annually, with the UK importing slightly more from the US than it exports.

Tory shadow chancellor Mel Stride acknowledged the uncertainty surrounding the impact of Trump’s trading policies on the UK economy, but asserted that a 'resilient economy' would better equip the country to face potential challenges.

He stated, 'The way that you face those risks and get through turbulent times is a strong economy, a growing economy – not one in which businesses are being taxed to the point where they’re laying people off.'