'Act of War': Warren Buffett Reacts To US President Donald Trump's Tariffs For Canada, Mexico

Ace investor Warren Buffett slammed US President Donald Trump's newly imposed tariffs, calling the move an "act of war". The comments came just before reciprocal tariffs on Canada, China and Mexico were expected to come into effect from Tuesday, Mar. 4.

"Tariffs are actually—we've had a lot of experience with them—they're an act of war, to some degree,” Buffett said, during an interview with CBS on Sunday.

Buffett added that the burden of the higher tariffs would have to be borne by consumers. “I mean, the tooth fairy doesn’t pay them,” he said.

Buffett’s criticism comes days after Trump’s 25% tariff threats turned into a reality for Canada, Mexico and China. On Monday, Trump reiterated that there was no room left on the issue, adding they go into effect Tuesday.

Trump’s threats first appeared to be turning into a reality on Feb. 28 when he confirmed that the delayed tariffs on Canada and Mexico imports would take effect March 4. 

The same day, China was threatened with an additional 10% tariff on its US exports. This would raise total tariffs on Chinese imports in the US to 20%.

Following Donald Trump’s election victory in November last year, the potential impact of these threats weighed on global markets, but his apparent confirmation sent stock prices plummeting on Monday. 

While Buffett largely stays away from political affairs, he had touched upon this particular issue in his annual letter as well. In his annual letter to shareholders on Feb. 23, Buffett urged the US government to use the money he sends it responsibly.

The legendary investor had expressed gratitude in his letter. He said that Berkshire hopes to make even larger payments in the future. Buffett advised the government to spend wisely and emphasised the importance of supporting those facing hardships "through no fault of their own.” He also noted that maintaining a stable currency requires both "wisdom and vigilance."

During the CBS interview, Buffett was also asked about his views on the US economy, which appears to be under stress. “I can’t talk about it, though. I really can’t,” he said, excusing himself.

During Donald Trump’s first term, Buffett had weighed on the tariff issue in 2018-19 in multiple interviews.  He warned that aggressive tariffs would undoubtedly harm the global economy.

According to Reuters, the tariffs are set to take effect from 05:01 GMT on Tuesday, pushing North America closer to a regional trade war.