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China Escalates Trade War, Increases Tariffs on U.S. Goods to 125%

China is escalated a dangerous game of “measure the manhood” between Chinese President Xi Jinping and President Donald Trump.

On Friday, the Chinese Finance Ministry called Trump’s reciprocal tariffs on China a “unilateral bullying and coercion,” tactic, thereby raising their tariffs on U.S. goods from 84% to 125%, effective on Saturday.

The Ministry announced, “The United States’ imposition of abnormally high tariffs on China seriously violates international trade rules, basic economic laws and common sense, and is a completely unilateral bullying and coercion practice.”

“Given that at the current tariff level, there is no market acceptance for U.S. goods exported to China, if the U.S. continues to impose tariffs on Chinese goods exported to the United States, China will ignore it,” the Ministry added.

According to the White House, the effective U.S. tariff on Chinese goods could be raised as high as 145% for some categories of goods due to the fact that the 125% rate is on top of a 20% tariff that is already in place.

The Tax Foundation’s Center for Federal Tax Policy warned Trump that a 145% tariff would cease trade across the Pacific.

“It depends on how narrowly the tariff is applied or how broadly it’s applied, but generally if you get north of a triple-digit tariff, you are cutting off most trade,” the center’s vice president of federal tax policy Erica York said. “There may still be some things without any substitutes that companies just have to foot the bill, but for the most part, that cuts it off.”

On Friday, Xi stated that a tariff war would have “no winners.”

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