Trade Freedom and The Myth of Tariff Reciprocity
Trump's trade agenda represents a misguided approach to achieving global fairness.
President Trump is imposing steep and expansive tariffs on the world economy as part of what he calls his tariff “Liberation Day” agenda.
It is not clear how these massive tax hikes, reaching as high as $600 billion according to the White House’s own estimates, will “liberate” anything other than money from the wallets of American consumers. Nonetheless, Trump has justified his new tariff policy around the claim that the United States is being taken advantage of by the discriminatory trade policies of other nations.
In the White House’s telling, these new tariffs “will bring back fairness and prosperity to the distorted international trade system and stop Americans from being taken advantage of.” Trump describes his measures as “reciprocal” and claims they are only necessary because other countries apply even more egregious tariff and non-tariff barriers (NTBs) to American goods on the international market. As Trump himself recently put it when justifying his tariffs on Canada, “We’ve been ripped off for years and we won’t be ripped off anymore.”
There’s a problem with the White House’s tariff justification, though: it’s a complete myth.
The United States is currently one of the worst offenders among developed nations in placing discriminatory tariffs and NTBs on our trading partners. This ignominious position may be seen in the Heritage Foundation’s Index of Economic Freedom, which compiles an annual “trade freedom” score for nearly 200 countries and political jurisdictions. According to the 2025 report, the United States ranks in 69th place, putting us lower than New Zealand (2nd), Australia (3rd), the United Kingdom (17th), Canada (18th), France (38th), and Germany (39th).
The Heritage 100-point scale combines the country’s trade-weighted average tariff rate with a scoring of its NTBs—an assortment of quotas, export restrictions, subsidies, regulations, and similar policies that discriminate against foreign goods or unfairly prop up domestic products. A score closer to 100 represents lower tariff rates and fewer discriminatory trade policies.
The United States’ score of 75.6 places it well below most of the European Union countries, as well as all of the aforementioned major trading partners. In fact, our discriminatory trade policies place us in closer proximity to China’s score (74) than one of the main targets of Trump’s current trade war, Canada (83.2).
“Trade Freedom” Score for Top 100 Countries, (Heritage Foundation 2025)
Country | Index Year | Trade Freedom |
Singapore | 2025 | 95 |
New Zealand | 2025 | 90.4 |
Australia | 2025 | 90 |
Mauritius | 2025 | 87.4 |
Bahrain | 2025 | 86.6 |
Liechtenstein | 2025 | 86.6 |
Switzerland | 2025 | 86.6 |
Taiwan | 2025 | 86.6 |
Georgia | 2025 | 86.2 |
Seychelles | 2025 | 85.2 |
Norway | 2025 | 85 |
Brunei Darussalam | 2025 | 84.8 |
Spain | 2025 | 84.6 |
Kosovo | 2025 | 84.2 |
Albania | 2025 | 83.4 |
Malaysia | 2025 | 83.4 |
United Kingdom | 2025 | 83.4 |
Canada | 2025 | 83.2 |
Israel | 2025 | 82.8 |
Jordan | 2025 | 82.4 |
Peru | 2025 | 81.6 |
Qatar | 2025 | 81.6 |
Uzbekistan | 2025 | 80.6 |
Iceland | 2025 | 80.4 |
Kiribati | 2025 | 80 |
Timor-Leste | 2025 | 80 |
Papua New Guinea | 2025 | 79.8 |
Vietnam | 2025 | 79.8 |
Austria | 2025 | 79.6 |
Belgium | 2025 | 79.6 |
Bulgaria | 2025 | 79.6 |
Croatia | 2025 | 79.6 |
Cyprus | 2025 | 79.6 |
Czech Republic | 2025 | 79.6 |
Denmark | 2025 | 79.6 |
Estonia | 2025 | 79.6 |
Finland | 2025 | 79.6 |
France | 2025 | 79.6 |
Germany | 2025 | 79.6 |
Greece | 2025 | 79.6 |
Hungary | 2025 | 79.6 |
Ireland | 2025 | 79.6 |
Italy | 2025 | 79.6 |
Latvia | 2025 | 79.6 |
Lithuania | 2025 | 79.6 |
Luxembourg | 2025 | 79.6 |
Malta | 2025 | 79.6 |
Montenegro | 2025 | 79.6 |
Netherlands | 2025 | 79.6 |
Poland | 2025 | 79.6 |
Portugal | 2025 | 79.6 |
Romania | 2025 | 79.6 |
Slovakia | 2025 | 79.6 |
Slovenia | 2025 | 79.6 |
Sweden | 2025 | 79.6 |
Indonesia | 2025 | 79.4 |
The Philippines | 2025 | 79.2 |
Botswana | 2025 | 78.8 |
Panama | 2025 | 78.6 |
United Arab Emirates | 2025 | 78.4 |
Oman | 2025 | 78.2 |
Paraguay | 2025 | 78.2 |
Chile | 2025 | 78 |
North Macedonia | 2025 | 77.8 |
Moldova | 2025 | 77.2 |
Serbia | 2025 | 77.2 |
Japan | 2025 | 76.2 |
Kuwait | 2025 | 75.6 |
United States | 2025 | 75.6 |
Costa Rica | 2025 | 75.4 |
Tonga | 2025 | 75.4 |
Micronesia | 2025 | 75 |
Mongolia | 2025 | 74.4 |
Turkmenistan | 2025 | 74.2 |
China | 2025 | 74 |
Mozambique | 2025 | 74 |
Eswatini | 2025 | 73.6 |
Kyrgyz Republic | 2025 | 73.6 |
Kazakhstan | 2025 | 73.2 |
South Korea | 2025 | 73.2 |
Ukraine | 2025 | 73.2 |
Uruguay | 2025 | 73 |
Cuba | 2025 | 72.8 |
Saudi Arabia | 2025 | 72.8 |
Turkey | 2025 | 72.8 |
Thailand | 2025 | 72.4 |
Colombia | 2025 | 72.2 |
Guatemala | 2025 | 72.2 |
Mexico | 2025 | 72.2 |
Tajikistan | 2025 | 72.2 |
Armenia | 2025 | 72 |
Jamaica | 2025 | 71.8 |
Brazil | 2025 | 71.6 |
Angola | 2025 | 70.4 |
El Salvador | 2025 | 70.4 |
Bosnia and Herzegovina | 2025 | 70 |
Côte d’Ivoire | 2025 | 70 |
Namibia | 2025 | 70 |
Azerbaijan | 2025 | 69.8 |
Pakistan | 2025 | 69.8 |
The Heritage index should not be dismissed as a product of a right-leaning think tank. Its data are consistent with (and indeed draw upon) other indexes of tariff barriers. The World Bank maintains an index of each country’s weighted mean tariff rate in the most recent year with available data, with 2022 being the current measure. This index does not include NTBs, which are more difficult to quantify. It is nonetheless a reputable source of the tariff component of current trade barriers.
According to the World Bank’s series, the United States’ weighted mean tariff rate sits at 1.49%, placing it 47th overall among countries. For comparison, Australia (0.99%), the United Kingdom (1%), all of the European Union countries (1.33%), and Canada (1.37%) have lower tariff rates than the United States.
In fact, according to estimates from the Tax Foundation, Trump’s “reciprocal” tariff policies are currently estimated to raise the United States’ average tariff rate to 8.4% by the end of 2025. Further tariff hikes on “liberation day” could raise this even higher, with some inside the administration calling for a “benchmark” overall tariff of 20%. For reference, an 8.4% average tariff would place the United States just behind Uganda (7.86%) in the World Bank’s rankings. A 20% benchmark tariff would give us the third-highest tariff rate in the world, just behind Equatorial Guinea (18.2%) and significantly higher than the tariff rates imposed by the Marxist governments of Cuba (9.16%) and Venezuela (12.8%).
These data conclusively belie the White House’s claim that the United States is the victim of unfair and discriminatory tariff and NTB policies from abroad. In reality, we impose higher tariffs and more severe NTBs on average than most developed nations.
If Trump truly wanted tariff “fairness,” he would abandon the rhetoric of victimization that he has adopted. The data above show that it has little basis in empirical reality. Genuine trade reciprocity would entail the United States lowering our current tariff rates and removing NTBs to put us at closer parity with our major trading partners.
Catalyst articles by Phillip Magness | Full Biography and Publications