What Trump could demand in a UK trade deal

A US-UK trade deal might finally be within touching distance after five years of failed negotiations after US Vice President JD Vance said there was a “good chance” for it to come off.

It comes after the White House stung its key trading partners with significant tariffs, sending the stock market into freefall.

Downing Street hopes a trade deal will help bolster growth and shield the UK from the worst tariffs. But the devil will be in the details when the US reveals what it wants in return.

Trade experts weighed in on what the US might ask for – and whether or not the UK should agree.

Buy our ‘beautiful’ beef

The US has long been keen for access to UK’s agricultural markets, leading to fears that lower-quality American meat products could undercut British farmers.

The US is understood to be pushing to reduce certain UK standards to enable its producers to sell food in Britain.

National Farmers Union President Tom Bradshaw said there are “serious concerns” that the US is pressuring the UK government to weaken food standards. He said it could lead to imports of products that “would be illegal for our farmers to produce in the UK.”

Trump’s officials have been bullish about bringing US meat to new markets.

“They hate our beef because our beef is beautiful and theirs is weak,” Commerce Secretary Howard Lutnick told Fox News, a sentiment that’s likely to apply to British regulation as well.

Mr Bradshaw said British farmers had some of the world’s highest standards and that the public wants the meat they buy to be “produced responsibly and not using methods that were rightly banned in the UK decades ago”.

“Ministers have consistently pledged to protect British farmers and uphold the UK’s high standards for food safety, animal welfare and environmental protection in all future trade negotiations,” he said.

“We will continue to work with the government to ensure these commitments are upheld and that standards are not compromised.”

Service alignment

Most UK-US trade is not in goods but services, which make up the bulk of both nations’ economies. Between October and December 2024, services accounted for 81 per cent of total UK economic output and 83 per cent of jobs.

According to Maxwell Marlow of the Adam Smith Institute, Washington is likely to want greater alignment in financial regulation. Its wishlist could cover rules around accountancy, legal practice, and consultancy to allow a greater flow of professionals between the two countries.

Unleash the whisky

Mr Marlow said Scotch whisky, due to its popularity with American consumers, is also likely to be involved in a trade deal.

The US is the largest whisky market by value, buying £971m in 2024.

The Scotch Whisky Association said it supports the Government in promoting “strong and open trade relations with key export markets around the world” and “engage with the US Administration.”

“The United States remains a key market for Scotch, and where the industry contributes to the US economy through direct investment and jobs,” chief executive Mark Kent said.

Defanging Ofcom

Ofcom – the UK regulator for TV, radio and social media – might not be an obvious focus for US trade negotiators.

But the body appears to have drawn the ire of the White House, and a trade deal may be contingent on relaxation of communications regulations in the UK.

“Sources in the White House tell me they’re rather annoyed about Ofcom and free speech in the UK, particularly over Gab,” Mr Marlow said.

Gab, an American free speech platform popular with the far right, has accused the UK Government of “declaring war” on it and “censoring” its content because it was asked to complete an illegal-content risk assessment to comply with the Online Safety Act. It blocked all UK users rather than complying.

“It might be that a condition of a trade deal is on the UK stepping back on the Online Safety Act,” Mr Marlow said, effectively “exporting American values” through trade. “It is a strange approach, but everything’s on the table now.”

An Ofcom spokesperson said the body was “getting on with the job we’ve been given by Parliament – to implement and enforce the Online Safety Act”, which has “free speech at its core” and is focused on “protecting people in the UK from illegal content and activity like child sexual abuse material and fraud.”

“Some services might seek to prevent users in the UK from accessing their sites or parts of their sites, instead of complying with the Act’s requirements to protect UK users. That is their choice,” it said, in an apparent reference to Gab’s UK shutdown.

Relax the Big Tech tax

Another unusual element of a trade deal might be the 2 per cent taxation on Big Tech companies, known as a digital services tax, which was introduced in 2020.

The tax applies to search engines, social media services, and online marketplaces that “derive value from UK users.”

To be subject to the tax, tech businesses must generate more than £500m in worldwide revenues and more than £25m from UK users.

Since taking office, Trump has signed a memorandum to investigate and possibly hit back at digital services taxes around the world, which he branded “overseas extortion” and “discriminat[ion] against US companies”.

Mr Marlow suggested that the digital services taxes may be renegotiated to a lower rate to obtain a US-UK trade deal.

This would likely benefit Elon Musk, a close Trump ally who owns X, as well as other US billionaires like Mark Zuckerberg.

Shanker Singham – a former trade adviser to the UK and US who now leads the consultancy Competere – said the US “will want to see the UK meaningfully reduce their trade barriers”, including the Digital Services Tax.

“This will be a negotiation, so the US has already made its opening bid,” he said, ” and the UK needs to respond.”

“This does not mean everything has to be solved, just a genuine attempt to solve many of these issues.”

NHS not on the table – but science and medical tech are

There have long been fears that the US would demand access to the NHS in any trade deal.

Health Secretary Wes Streeting has said that the NHS “is not up for grabs, and it’s not on the table in the context of trade.”

However, he said, “There are a number of areas where we can and should work together to deepen the trading relationship between our two countries”, citing life sciences and medical technology.

Mr Singham said that the US was “not especially interested in the NHS, except to ensure its pharmaceutical companies can sell their products to it on reasonable commercial terms,” which he argued “does not seem an outlandish ask.”

US ‘should compromise on tariffs’ – and know its limits

The UK was recently slapped with 10 per cent tariffs from the Trump Administration, although these were later paused for 90 days.

The US is the UK’s largest export market for goods and services and the world’s largest economy.

All car imports to the US were subject to a 25 per cent levy, which Trump has not paused.

It’s a significant blow to British manufacturers as cars are the biggest single UK export item to the US.

William Bain, head of trade at the British Chambers of Commerce, said that both sides would need to look at reducing tariffs if a successful trade deal is to be agreed.

“With any trade negotiations, flexibility is needed,” Mr Bain said.

“Issues such as digital services tax and AI development and regulation will be on the table, too. But this will in all likelihood not be a full free-trade agreement, so areas where finding consensus may be difficult should not be a block to an economic partnership deal between the UK and US. A win-win for businesses on both sides of the Atlantic if it is agreed.”