Total U.S. trade with Israel amounted to an estimated $37 billion in 2024, and the U.S. bilateral deficit stood at $7.4 billion, an 8.6 percent increase over the previous year, according to U.S. trade data. Israeli import taxes on U.S. goods amount to $11.3 million annually, with most levied on food, according to Israel’s finance ministry. Mr. Trump has already imposed several major tranches of tariffs, including ones that apply broadly to imports from China, Canada and Mexico. He has also announced tariffs on imported cars and car parts, which are set to go into effect on Thursday. The Trump administration has given few details about which countries and sectors will be included in the tariffs announcement on Wednesday, and it was not clear whether the levies would affect Israel.

Israel has cancelled its remaining tariffs on imports from the United States, officials said on Tuesday, a day before the Trump administration hits global trading partners with reciprocal levies. The move still needs a final signature from Economy Minister Nir Barkat and parliament's finance committee - both expected - but once done "tariffs on all imports from the United States will be cancelled," the prime minister's office said. The United States is Israel's largest trading partner and closest ally, with bilateral trade worth $34 billion in 2024. "The removal of tariffs on American goods is another step ... to open the market to competition, to diversify the economy, and to lower the cost of living," Prime Minister Benjamin Netanyahu said in a joint statement with Barkat and Finance Minister Bezalel Smotrich.

Trump’s tariffs are set to go into place on Wednesday, April 2, which his administration is calling “Liberation Day.” Trump reporters told reporters on Sunday that the tariffs would be on “all countries,” though advisors in his administration said they would focus on select countries with the largest trade imbalances. Smotrich said his goal is to have a “zero-tarrif policy” and “maintain positive trade relations” with the United States. The United States is currently Israel’s largest trading partner, with total goods trade estimated to be valued at $37 billion in 2024. In 2024, the US imports from Israel stood at $22.2 billion, while exports were estimated at $14.8 billion, according to the US trade representative.