Trump warns of 35% tariff on goods US companies import back to the country from foreign factories

US president-elect Donald Trump warned American companies on Sunday that he would impose a 35% tariff on goods that US companies import back to the country from their foreign factories abroad.

The threat of higher tariffs on goods produced by US factories abroad coming back into the country is part of Trump’s plan to incentivize businesses to stay in America.

Trump added that there would also be “retributions or consequences” for US companies that move their operations out of the country – such as a hefty border tax.

In a series of Tweets posted early Sunday morning Trump said:

“The U.S. is going to substantially reduce taxes and regulations on businesses, but any business that leaves our country for another country, fires its employees, builds a new factory or plant in the other country, and then thinks it will sell its product back into the U.S. without retribution or consequence, is WRONG! There will be a tax on our soon to be strong border of 35% for these companies wanting to sell their product, cars, A.C. units etc., back across the border. This tax will make leaving financially difficult, but these companies are able to move between all 50 states, with no tax or tariff being charged. Please be forewarned prior to making a very expensive mistake! THE UNITED STATES IS OPEN FOR BUSINESS”

The comments by Trump come following his successful attempt at preventing Carrier from moving production from Indiana to Mexico – about 800 jobs were at stake.

The state of Indiana will offer Carrier approximately $7 million in incentives while the company will invest $16 million in the factory over the next two years.

The deal received criticism from liberal lawmakers and from early Trump supporter Sarah Palin, the former governor of Alaska, who suggested the Carrier deal is ‘crony capitalism’. “When government steps in arbitrarily with individual subsidies, favoring one business over others, it sets inconsistent, unfair, illogical precedent,” Palin wrote in an op-ed for the Young Conservative website.

However, business groups welcomed the move.

“Now, hundreds of Indiana workers will now keep good jobs, preserving their place in the middle class,” Scott Paul, president of the Alliance for American Manufacturing, said in a statement Friday. “While inducements and high-level interventions aren’t the most efficient ways to keep jobs here, they’re sometimes absolutely necessary.”