‘Liberation Day’: What we know, what we don’t about Donald Trump’s big tariff plan

The countdown to Liberation Day in the US has begun. A little past midnight (IST), Donald Trump is expected to announce a tariff plan to curb what the White House terms “unfair practices that have been ripping off” America for decades.

India, like the rest of the world, is watching nervously. Markets worldwide have been fluctuating amid fears of reciprocal tariffs , which could unleash a full-fledged trade war. So what can we expect on “Liberation Day”? The exact plan remains under wraps, but here’s what we have gathered so far.

What will Donald Trump announce on “Liberation Day”?

Yes, big tariffs are coming. And with the back and forth on import taxes since Trump took office on January 20, it’s been difficult to keep track.

Trump has raised duties on steel and aluminium, Chinese imports, and goods from Canada and Mexico. Last week, he announced 25 per cent tariffs on all cars and auto parts imported into the US.

Now, a wider set of tariffs will be unveiled within hours. US Treasury Secretary Scott Bessent has said that the tariffs will be announced at 4 pm Washington time on April 2, which is 1:30 am IST on April 3.

The US president told reporters on Monday night that he has “settled” on a tariff plan. However, CNN reported that White House advisers were still presenting options to him on Tuesday, even as the deadline neared.

The size and scope of the tariffs are still undecided. A tiered tariff plan with a flat rate for countries or a more customised reciprocal plan is being considered, reports Bloomberg. If Trump decides to go with the first option, levies of either 10 or 20 per cent could be imposed on foreign goods, depending on their tariff and non-barrier tariff on US goods.

While the White House has not revealed any details, there have been several reports in the US media. Fox News reported on Tuesday that Trump was still considering a flat 20 per cent global tariff, but the Wall Street Journal said that the US administration was looking at a more targeted option.

According to the Washington Post, White House aides are considering a plan that would raise duties on products by about 20 per cent from nearly every country, rather than targeting certain countries or products. The administration anticipates the new duties could raise more than $6 trillion in revenue that could be sent on to Americans as a rebate, the paper reported.

While auto tariffs will come into effect on April 3, other sector-specific tariffs on semiconductors, pharmaceuticals, lumber and copper will be pushed to a later day, according to a report in The Financial Times. However, they will also be imposed eventually.
However, a White House aide said any report ahead of Trump’s announcement is “mere speculation”.

What we know for certain is that the tariffs will come into effect immediately. White House spokeswoman Karoline Leavitt said that reciprocal tariffs on countries that impose duties on US goods would take effect immediately after Trump announces them.

Where will Trump make the tariff announcement?

It is uncertain what final decision Trump will take on tariffs. But what we know for sure is how and where Potus will unveil his “Liberation Day” plans.

The tariffs will be announced in his first Rose Garden conference of his second term, Leavitt told the media. The Cabinet will be present.

“Wednesday, it will be Liberation Day in America, as President Trump has so proudly dubbed it… The President will be announcing a tariff plan that will roll back the unfair trade practices that have been ripping off our country for decades. He’s doing this in the best interest of the American worker,” she said.

A flamboyant event is expected. Trump even joked that he wanted to wear Kid Rock’s flashy jumpsuit – a bright red outfit with white and blue inlays that was based on the American flag – for “Liberation Day” when he met the American rap artist at the Oval Office on Monday.

Which countries will be worst hit by tariffs?

The White House has not said which countries will be affected. However, it is unlikely that any country will be spared.

On Sunday, Trump said that new tariffs could apply to “all countries”. While Trump has repeatedly branded India as a “tariff king” and a “big abuser” of trade, the US has not specifically imposed levies on the country so far. However, this could change with the upcoming announcement.

Last month, Treasury Secretary Scott Bessent said the focus was on the “Dirty 15” – the 15 per cent of countries that account for the bulk of trade and with the largest trade imbalances with the US. India appears on the list along with China, Mexico, Canada, the European Union, the UK, Switzerland, Turkey, Argentina, Brazil, Vietnam, Thailand, South Korea, Malaysia, Indonesia, Taiwan, and Saudi Arabia.

Is there any room for negotiation?

Bessent told Republican House lawmakers that the reciprocal tariffs Trump will announce represent a “cap” of the highest US tariff level that countries will face, indicating that this could be the maximum levies imposed. However, the US administration has clarified that negotiations are possible.

The tariffs could go down if they [the countries] meet the administration’s demands, according to Republican Representative Kevin Hern from Oklahoma.

The White House press secretary also said that Trump was open to subsequent negotiations. “Certainly, the president is always up to take a phone call, always up for a good negotiation,” she said.

How are countries bracing for tariffs?

The world is no edge as uncertainty looms over tariffs.

Ahead of the April 2 deadline, Trump said that India is expected to drop tariffs substantially. During a press briefing at the Oval Office, when asked if he would push away some of America’s allies, Trump responded, “I think a lot of them will drop their tariffs because they were being done in an unfair way. They’ve done this for years. If you look at the European Union, they already dropped their tariffs on cars down to two-and-a-half per cent. It was announced a couple of days ago. And I think I heard just a short while ago that India will be dropping its tariffs very substantially.”

India is finalising terms for a US trade deal following the intervention from the Prime Minister’s Office, reports The Indian Express. The two sides are ready for negotiations where India is expected to lower tariffs on American goods in exchange for concessions from the US, a government official was quoted as saying by the newspaper.

The European Union has a “strong plan” to retaliate against tariffs imposed, and set to be imposed, although it would prefer to negotiate a solution, EU executive chief Ursula von der Leyen said on Tuesday.

Canadian Prime Minister Mark Carney spoke with Mexican President Claudia Sheinbaum on Tuesday about Canada’s plan to “fight unjustified trade actions”.

“With challenging times ahead, Prime Minister Carney and President Sheinbaum emphasised the importance of safeguarding North American competitiveness while respecting the sovereignty of each nation,” Carney’s office said in a statement.

While Canada has spoken of retaliation, Sheinbaum, who previously said that Mexico would seek “preferential treatment” with Trump and his tariffs, shifted her tone Tuesday to note that the tariffs set to go into effect on Wednesday were not targeting her country.

Meanwhile, China, Japan and South Korea have reportedly agreed to jointly respond to US tariffs, a social media account affiliated with Chinese state media said on Monday. However, Seoul called the assertion “somewhat exaggerated”, while Tokyo said there was no such discussion.

The state media comments came after the three countries held their first economic dialogue in five years on Sunday, seeking to facilitate regional trade amid looming tariffs.

A clearer picture will only emerge once the tariffs are announced.

With inputs from agents