Trump Reaps $50 Billion As World "Chickens Out" On Tariff Retaliation

US President Donald Trump, mocked for "always chickening out," has reaped nearly $50 billion in revenue from his aggressive new tariff regime, while much of the world has hesitated to hit back.

Data released by the US Treasury shows customs revenue soared to $64 billion in the second quarter, up $47 billion from the same period last year, a historic high.

Four months after Trump launched his aggressive new trade policy, only China and Canada have implemented significant retaliatory tariffs. Trump's policy imposed a minimum 10 per cent global tariff, 50 per cent levies on steel and aluminium, and 25 per cent duties on automotive imports, prompting fears of a full-blown trade war.

Those fears have largely not materialised, due in large part to global restraint.

"Trump has made it clear that he is prepared to raise tariffs further in the face of retaliation," Marta Bengoa, professor of international economics at City University of New York, told The Financial Times. "Many countries learned from the 2018-2019 trade war that retaliation often leads to counter-retaliation rather than negotiated solutions."

China has mounted the most sustained pushback, yet its tariffs haven't translated into comparable financial gains. Chinese customs duty income rose just 1.9 per cent in May 2025 compared to a year earlier. Canada's response was notable but brief: it imposed C$155 billion in retaliatory tariffs earlier this year but has since pulled back under economic pressure.

Other major US trade partners have refrained from tit-for-tat responses. Many are still negotiating behind the scenes to avoid further escalation.

The European Union, the world's largest trading bloc, has prepared a retaliatory tariff package targeting Euro 72 billion worth of American goods, including aircraft, bourbon, and automobiles, but has delayed implementation, Reuters reported. Officials cite the August 1 deadline Trump set for trade negotiations as a key factor behind the hesitation.

"They affect the whole spectrum of US relations, including those regarding security," said an EU official familiar with the talks, linking trade decisions to geopolitical issues like US support for Ukraine.

Major companies, including Apple, Adidas, and Mercedes-Benz, have shifted sourcing strategies and absorbed some costs to minimise consumer fallout in the US market.

Trump's tariff levels are the highest seen since the Smoot-Hawley Tariff Act of the 1930s.

Mexico, the United States' largest trading partner, has refrained from retaliation. President Claudia Sheinbaum has instead prioritised a negotiated solution, citing economic pragmatism.

Even China, which imposed tariffs as high as 145 per cent, scaled back to 30 per cent after a 90-day truce agreed in Geneva in May. Canada, too, has retreated from its initial "elbows up" rhetoric, with Prime Minister Mark Carney shelving plans for a digital services tax and opting not to mirror Trump's move to double steel tariffs.

Looking forward, the European Commission is quietly warning of a potential turning point. Trade Commissioner Maros Sefcovic warned that a 30 per cent tariff on EU exports would make transatlantic trade "almost impossible."