Trump says U.S. to impose 5 percent tariff on all Mexican goods

President Donald Trump said Thursday night that the United States would impose a 5 percent tariff on all Mexican goods starting next month, saying the sweeping tariffs would rise monthly to as high as 25 percent "until Mexico substantially stops the illegal inflow of aliens coming through its territory."

Trump has previously threatened to use trade as an incentive to persuade Mexico to reduce immigration through the southern border — in April 2018, he tweeted that Mexico must "stop the big drug and people flows, or I will stop their cash cow, NAFTA. NEED WALL!"

That was a reference to the 25-year-old North American Free Trade Agreement, which would be replaced by the United States-Mexico-Canada Agreement, which Trump, Mexican President Andrés Manuel López Obrador and Canadian Prime Minister Justin Trudeau signed in November.

Trump’s announcement comers at a delicate time. Thursday, López Obrador asked Mexico’s Senate to ratify the deal on Thursday, and Vice President Mike Pence was in Ottawa, the Canadian capital, on Thursday to promote the agreement.

In a statement, the White House said the new tariffs would go into effect on June 10 and would rise by 5 percentage points every month — to 10 percent on July 1, 15 percent on Aug. 1 and so on — until they hit 25 percent on Oct. 1.

"Tariffs will permanently remain at the 25 percent level unless and until Mexico substantially stops the illegal inflow of aliens coming through its territory," it said.

Normally, Congress, not the president, has the authority to raise taxes and tariffs, but the president can do so by declaring special circumstances that constitute a threat to national security.

That’s the basis under which Trump raised tariffs on steel and aluminum imports on other countries in March 2018. The president has long argued that what he calls illegal immigration is an existential threat to the country’s security.