The UK-US trade deal isn’t done yet. Here’s what’s still on the table.
Politico | 2 December 2025
The UK-US trade deal isn’t done yet. Here’s what’s still on the table.
By Sophie Inge, Graham Lanktree, Caroline Hug and Tom Bristow
LONDON — It was a deal that promised so much for the U.K.: reduced U.S. tariffs for most British goods, zero duties on steel, a lower rate for cars, expanded digital trade, plus preferential treatment for pharmaceuticals.
Hastily patched into the Oval Office via speaker phone, U.K. Prime Minister Keir Starmer hailed May’s Economic Prosperity Deal as “historic,” while President Donald Trump called it a “great deal” for both countries.
Seven months and one extravagant gold-plated state visit later, U.K. negotiators are still haggling over key elements. Britain’s trade chief told reporters he hopes to fly to Washington before Christmas to keep bargaining as businesses continue to pile pressure on No. 10 to relieve the tariffs — and deliver on the Starmer government’s main mission to spur economic growth.
Some key elements have been locked down, the latest being a zero tariff rate for British drugs in exchange for an increase in how much its National Health Service will pay U.S. pharmaceutical firms for new drugs. The U.K. has also granted the U.S. billions of dollars of increased market access for beef and bioethanol and agreed to address “non-tariff barriers” — as well as deepen collaboration on economic security.
But as the U.K. gears up for another negotiating round, POLITICO sets out all the unfinished business.
Standards
The White House is pushing London to change its standards regime for goods and food manufacturing, said three people familiar with the ongoing talks.
“With the tariff wars going on, standards have surfaced as another tool in the trade negotiators’ box,” said a senior U.K. regulatory figure familiar with the negotiations, noting that “the U.K. is a cornerstone of the global system of trade” and that its regulatory system for goods and food manufacturing helps set the pace globally.
“Almost all of British standards are international and European regional standards,” the regulatory figure said, whereas the U.S. has a fragmented system often set by private business organizations for safety in the manufacturing of toys, PPE, food products and other goods that varies from state to state — even down to the local level.
“The U.S. is trying to export [its] fragmented regulatory structure,” this person added. “And the difficulty is that they can’t offer any reciprocity.”
Heavy goods vehicles
As part of sweeping global tariffs from Nov. 1, Trump hit U.K. exports of medium and heavy-duty trucks, truck parts and buses, with a 25 percent tariff on the vehicles and key components and a 10 percent tariff on buses.
This raised duties on U.K. medium- and heavy-duty vehicle exports to 50 percent, up from 25 percent, and on off-road vehicle exports from zero to 25 percent. Tariffs on parts now range from 25 percent to 30 percent.
Britain’s SMMT automotive lobby is urging U.K. negotiators to push the Trump administration to remove the new levies. On Monday, Trade Minister Chris Bryant said heavy truck tariffs are part of ongoing talks.
Steel
Despite early pledges to lower tariffs on steel from the current 25 percent, Washington hasn’t budged. A key sticking point is the U.S. insistence on strict rules of origin — steel has to be melted and poured in its home country to qualify for any tariff relief. Several steel industry figures say talks have gone quiet since negotiations fell apart ahead of Trump’s state visit in September.
The requirements have been a big ask for Britain. The country’s biggest exporter to the U.S. — Tata Steel UK’s Port Talbot plant — shut down last September as it transitions to greener arc furnaces that won’t come online until 2027. In the meantime the company has been relying on imports from steel plants in India and the Netherlands, complicating any effort to meet Washington’s demands. The plant has also sourced steel from Chinese-owned British Steel in Scunthorpe.
Meanwhile, U.S. Trade Representative Jamieson Greer has been calling for stronger coordination against a glut of Chinese steel exports, warning that “current international trade rules are inadequate” to combat Beijing’s industrial overcapacity and questioning “the political will of foreign members to take action” back in October.
Since then, the U.K. has been pushing to form a steel alliance with the EU and Washington aimed at countering China’s overcapacity. The hope is to align tariff policies and grant members preferential tariffs on the steel trade.
British steel producers are already bracing for Brussels’ own steel tariff regime designed to shield EU producers from Chinese overproduction — and any further friction with Washington could leave an already fragile industry even more exposed.
Despite the U.K.’s efforts to tackle Chinese dominance, Washington appears unimpressed. A business figure familiar with negotiations said a “big problem” from a U.S. perspective is the U.K.’s failure to engage with U.S. concerns about Chinese overcapacity.
This person added that the U.S. would be unlikely to grant any deeper concessions unless the U.K. engages in meaningful discussions on this issue.
Agriculture and whisky
The U.S. made it clear from the outset that they are seeking more than just beef and bioethanol access. During a visit to London just days after the announcement of the Economic Prosperity Deal in May, U.S. Agriculture Secretary Brooke Rollins pushed for U.K. market access for U.S. dairy, rice, poultry, pork and shellfish.
The U.K. has insisted it will not compromise on British standards and there is no sign of any more concessions on that front, publicly at least. But that hasn’t stopped British farmers from worrying.
In a letter to the prime minister shared with POLITICO, Britain’s farming unions, together with environmental and animal rights groups, raised “significant concerns” about the potential impact of further U.S. access to Britain’s agricultural commodities market on domestic food standards.
“U.K. farmers are proud to produce to some of the highest welfare and environmental standards in the world, standards we know are valued by U.K. consumers,” they wrote. “To ensure fairness across the economy, it is essential that these standards are not undermined by trade deals or regulatory decisions that give other sectors or foreign producers a competitive advantage.”
Farmers are also worried that the longer negotiations drag on, the more likely it is that the U.S. may go back on its promise to reallocate 13,000 metric tons of its “other countries” tariff rate quota for beef to the U.K. This reallocation had been set to take place “as quickly as possible and at the latest by 1 January 2026” but has yet to be implemented.
National Farmers’ Union President Tom Bradshaw said he feared British beef access could be deprioritized as other sectors of the economy, including steel, seek to reopen U.S. negotiations. “It is very worrying to reopen those conversations before the tariff rate quota has been signed off,” he said.
Meanwhile, Scottish lobbyists have not given up hope of a carveout for the scotch whisky industry, which they say will also prove beneficial for Kentucky bourbon makers that provide barrels to the U.K. whisky market. Asked about a potential scotch whisky deal in a recent interview, Starmer said: “Things are progressing and we’ve engaged on this heavily.”
Tech
Bryant said in a statement Monday that talks on non-tariff barriers — including in digital — are still ongoing.
Both sides agreed to a technology deal during Trump’s September state visit, committing the U.S. and the U.K. to cooperation on artificial intelligence and quantum and clearing the way for American tech giants to pour £30 billion into Britain. Since then, movement on the deal has been relatively quiet — with the next ministerial-level group meeting between the two nations scheduled for mid-March.
Despite Trade Secretary Peter Kyle’s insistence that the new tech partnership would "absolutely not” sway Britain’s plans to introduce its own AI legislation, evidence is piling up that the government is rethinking its AI Bill. Officials are now leaning toward handling safety concerns through a combination of other regulatory tools.
Another area of concern has been Britain’s digital services tax, with the Trump administration keeping up pressure on allies — from the EU to Canada — to scrap their tech levies. During the U.K. budget last week, however, a long-promised review of the tax on tech giants was quietly published, confirming it is staying put.
