The European Union has vowed to take "firm and immediate action" against Donald Trump’s imposition of tariffs.

       In a statement published on Friday (February 14), the European Commission warned the US President's proposed "reciprocal" trade policy is going "in the wrong direction".

       The Commission said: "The EU will take firm and immediate action against unjustified barriers to free and fair trade, including when tariffs are used to challenge legitimate and non-discriminatory policies. The EU will always protect European businesses, workers and consumers from unjustified tariff measures."

       The EU's executive branch negotiates trade relations on behalf of the 27-nation bloc. It said the EU has some of the lowest tariffs in the world and sees no justification for increased US tariffs on its exports.

       It said: "Tariffs are taxes. By imposing tariffs, the US is taxing its own citizens, raising costs for business, stifling growth and fuelling inflation. Tariffs heighten economic uncertainty and disrupt the efficiency and integration of global markets."

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       Earlier this week, the Commission warned that US tariffs on steel and aluminium would not go unanswered, but it is not yet clear what countermeasures would apply.

       Mr Trump slapped similar tariffs on EU steel and aluminium during his first term, which enraged Europe and other allies. In retaliation, the EU raised tariffs on US-made motorcycles, bourbon, peanut butter and jeans, among other items.

       European Commission President, Ursula von der Leyen, criticised Mr Trump's tariffs while speaking about China and a "rogue" Russia at the Munich Security Conference.

       She said: "A stronger Europe works with the United States to deter the threats we have in common as partners... And this is why we believe trade wars and punitive tariffs make no sense. Tariffs act like a tax that drive inflation."

       Ms von der Leyen said the EU does not believe it made good business sense, warning against "a global race to the bottom".

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       The Commission chief warned: "But as I've already made clear, unjustified tariffs on the European Union will not go unanswered."

       Mr Trump has already imposed 10% tariffs on imports from China, which has retaliated by imposing targeted tariffs on US imports as well as putting several companies on notice of possible sanctions.

       The president announced on Thursday (February 13) that he would impose "reciprocal tariffs" on all other countries, charging the same amount as levies imposed on US exports, claiming it was "fair to all".

       The policy published by the White House included VAT as a target for reciprocal tariffs, a sales tax widely used in the European Union and the UK.

       Brussels estimates the annual trade volume between both sides stands at about ￡1.2trillion ($1.5tn), representing some 30% of global trade. While the bloc has a substantial export surplus in goods, it says this is partly offset by the US surplus in the trade of services.

       The EU has said that trade in goods reached ￡696billion ($878bn) in 2023, with a trade surplus of ￡127.6bn ($161bn) for the EU. Trade in services was worth ￡562.7bn ($710bn) with a trade deficit of ￡85bn ($107bn) for the EU.

       The bloc’s average tariff rate is above that of the US in sectors including cars, chemicals and food, but the bloc’s overall average tariff rate is just under the US average of 3.95%, according to ING.