Donald Trump drops another tariff bombshell that may hit Australia

Donald Trump has flagged the US could double the baseline tariff on foreign imports to 20 per cent.

US President Donald Trump has threatened to raise the baseline tariff rate on all US imports to “somewhere in the 15-20 per cent range”, dialling up pressure on the Albanese government to avoid being hit with even higher tariffs.

The government has pledged to stay the course in its diplomatic approach to tariffs.

“Our position is unchanged – any tariffs on Australian goods are unjustified and an act of economic self-harm,” a spokesman for Trade Minister Don Farrell said.

“We will continue to engage at all levels to advocate for the removal of all tariffs, in line with our free-trade agreement with the United States.”

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Health Minister Mark Butler portrayed the latest threat as another update in volatile US trade talks, including in his own portfolio area, where the US has expressed grievances with the Pharmaceutical Benefits Scheme.

“The nature of some of these trade positions from the US administration – I’ve found that the position in relation to pharmaceuticals has changed a lot over the last couple of weeks – the nature, the timing, the scale of tariffs that might be imposed not just on Australia but on pharmaceutical imports to the US from anywhere in the world,” Mr Butler told ABC Radio National.

“So we’re trying to make sure that we have a sense of what the US administration is planning but continuing nonetheless to prosecute Australia’s national interest and reinforce the importance of free trade between our two countries which we’ve enjoyed since the free-trade agreement for more than 20 years.”

Mr Trump in Scotland said the tariff rate would be “somewhere in the 15-20 per cent range”.

“Probably one of those two numbers,” the President said.

He said he would soon notify countries of their new “world tariff” rate.