The prospect of higher taxes being introduced on imports to the US is concerning many world leaders because it will make it more expensive for companies to sell goods in the world’s largest economy.

Trump told global executives at the World Economic Forum on this week that they could either produce their goods in the US or face widespread tariffs worth hundreds of billions or even trillions of dollars.

But Reynolds said when it comes to manufactured goods, the US did not have a trade deficit with the UK.

“We know this is something that not just President Trump, but the whole of his administration takes very seriously,” he said.

“We’ve obviously got a services-based economy. The US does not have that deficit with us so if that’s the logic of that position, I think we’ve got an argument to engage with.”

Tariffs are a central part of Trump’s economic vision. He sees them as a way of growing the US economy, protecting jobs and raising tax revenue but he also uses them as leverage to pursue other policies.

He has already said he is considering imposing a 10% tax on imports from China as soon as 1 February, claiming the country is sending fentanyl, a synthetic opioid, to Mexico and Canada.

Trump had also threatened 25% tariffs on Canada and Mexico, again citing fentanyl as well as immigration among his concerns.

However, Trump has since said he “would rather not” impose tariffs, suggesting a trade deal could be on the table.