US Treasury secretary Steve Mnuchin has said he expects to wrap up a trade deal with the UK within the year, a day after he slammed a proposed British digital services tax as “discriminatory”.
The US’s commerce secretary Wilbur Ross, who was speaking at the same event at the World Economic Forum in Davos, Switzerland, said there were “far fewer issues between UK and US than between either of us and EU”.
The remarks were a change from the combative tone struck yesterday, when Mnuchin told UK chancellor Sajid Javid at a joint press conference at Davos that he was “disappointed” that the US was not above the EU on Britain’s list of trade deals.
He also yesterday threatened to slap tariffs on UK cars if the government presses on with a plan to increase taxes major digital firms, most of which are from the US. Javid defended the tax, saying it was “proportionate” and “temporary”.
But asked today about a UK trade deal, commerce secretary Ross said it should be easier to do than one with the EU because “our economies are much more similar”.
“Both are very heavily service oriented,” he said. “There are financial services and there is already a pretty high degree of integration and co-ordination.”
Asked whether the US would seek to increase the amount Britain paid for American pharmaceuticals as part of a trade deal, Ross said: “What we think is drugs should have similar prices wherever they are, but don’t believe we’re in any position to tell UK what to pay.”
The mooted US trade deal has been controversial in the UK, with many believing it will lead to lower food standards and include the NHS, although the government has denied this.
UK Prime Minister Boris Johnson will have been pleased by Mnuchin’s comments today, however. One of his key pledges during the December General Election was that leaving the EU would free the UK to strike its own trade deals with huge economies like the US.
The US Treasury secretary called a trade deal with the UK “an absolute priority of President Trump”. He said: “We expect to complete that with them this year, which we think will be great for them and great for us.”
Yet in a sign that things may not be so straightforward, UK trade secretary Liz Truss fired a warning shot at the US over the digital services tax. “UK tax policy is a matter for the UK chancellor, it’s not a matter for the US,” he said.
Business secretary Andrea Leadsom rammed home the message on Talk Radio this morning. She said Britain wants a trade deal with the US but insisted “huge multinationals who are making incredible amounts of income and profit should be taxed”.