Warren Buffett warns Trump: Tariffs are ‘an act of war’— and the tooth fairy won’t save you

ET OnlineLast Updated: Mar 04, 2025, 12:01:00 PM IST

Synopsis

US President Donald Trump has announced significant tariffs on Canada, China, and Mexico. Warren Buffett described the tariffs as an 'act of war'. In response, Canada and Mexico plan to impose counter-tariffs. Trump also increased tariffs on China, with Beijing threatening retaliation. The situation is likely to escalate trade tensions globally.

US President Donald Trump's tariffs on Canada, China, and Mexico drew criticism from investor Warren Buffett, who called the move an "act of war." Trump announced the tariffs on Monday, stating they would take effect Tuesday. Canada and Mexico, he said, cannot avoid them. The tariffs, which take effect on Tuesday, are expected to impact over $918 billion worth of US imports.

Tariffs are act of war: Warren Buffett Warns

Billionaire investor Warren Buffett described the tariffs as an "act of war." Speaking to CBS on Sunday, Buffett said, "Tariffs are actually - we've had a lot of experience with them - they're an act of war, to some degree." He explained that tariffs act as a tax on goods, leading to higher prices for consumers. Buffett also highlighted that his company, Berkshire Hathaway, has paid over $101 billion in taxes under his leadership. "The Tooth Fairy doesn’t pay 'em!" he said. However, he declined to comment on the current state of the US economy, stating, "I think that’s the most interesting subject in the world, but I won’t talk, I can’t talk about it, though. I really can’t."

Canada and Mexico impose retaliatory tariffs

Canadian Prime Minister Justin Trudeau announced retaliatory measures, saying Canada will impose 25 percent tariffs on $155 billion worth of American goods starting Tuesday. "Canada will not let this unjustified decision go unanswered," he said. Mexico's President Claudia Sheinbaum stated that her country has contingency plans ready in response to Trump's decision.

China's Response and Global Trade Impact

Trump also signed an order to raise tariffs on Chinese imports from 10 percent to 20 percent. In response, Beijing has warned of countermeasures to safeguard its economic interests. Additionally, Trump has hinted at imposing reciprocal tariffs on other US trading partners, including India.

The new trade policies are expected to heighten tensions between the US and its trading partners, potentially disrupting global markets and supply chains.