Bank of England's Taylor: High US Tariffs 'Here to Stay' for Years

Speaking at an event organised by Deutsche Bank on February 23, 2026, Bank of England Monetary Policy Committee member Alan Taylor delivered one of the clearest central-bank signals yet that the era of low US tariffs is over. 'I think the fundamental thing to realise is those tariffs are here to stay at some kind of number that is a lot — an order of magnitude — bigger than it was two years ago,' Taylor said. 'So I think we should expect this shock to play out also over many years.'

Taylor's remarks carry particular weight because they come from a sitting monetary policymaker at one of the world's most influential central banks. While politicians and trade negotiators often frame tariff increases as temporary bargaining tactics, Taylor's assessment treats the current tariff regime as a structural shift in the global trading system — one that businesses and policymakers should plan around rather than wait out. The implication is stark: companies that have been deferring supply chain decisions in the hope that tariffs will revert to pre-2025 levels are making a strategic error.

The timing of Taylor's comments is significant. They arrived on the same day that confusion engulfed UK and EU markets over whether Trump's new 15% Section 122 tariff would override existing bilateral trade deals. With the FTSE 100 falling at the open and the British Chambers of Commerce warning that UK exporters could face an immediate 50% increase in US tariff barriers, Taylor's 'here to stay' message adds a longer-term dimension to what many were treating as a short-term policy shock.

For UK businesses specifically, Taylor's warning has direct implications for strategic planning. If US tariffs remain elevated for years — not months — then the cost of exporting to the US is permanently higher. This affects pricing strategies, market prioritisation, and investment decisions. UK manufacturers who have been absorbing tariff costs in the hope of a near-term rollback may need to restructure their US market approach entirely, whether through price increases, localised US production, or reallocation of export volumes to other markets.

The broader macroeconomic picture reinforces Taylor's assessment. US tariff revenue hit $168.8 billion in fiscal year 2025, more than double the 2023 figure. The US effective tariff rate stands at 10.5% — the highest since the 1940s. With the Supreme Court striking down IEEPA tariffs but the administration immediately pivoting to Section 122 authority, the political will to maintain elevated tariffs is clear regardless of the legal mechanism used. Congress shows no appetite to override the president on trade policy, particularly ahead of midterm elections.

For importers and compliance teams, the practical takeaway is that tariff management is no longer a periodic exercise — it is a continuous operational function. Companies need real-time visibility into tariff rates across all jurisdictions, automated monitoring for rate changes, and the ability to rapidly model the impact of policy shifts on their product catalogs. The businesses that treat tariff intelligence as infrastructure rather than a one-off project will be best positioned to navigate what Taylor describes as a multi-year adjustment period.