The Trump administration on Thursday finalized new double-digit tariffs on several of the United States’ trading partners as it tries to recreate sweeping duties cut by the Supreme Court in February.
The new duties, which range from 10 to 12.5 percent, follow a five-month investigation into efforts by trading partners to remove labor-intensive goods from their supply chains and are set to take effect when a temporary 10 percent global tariff expires.
From Friday, 17 trading partners – including Canada, the European Union, Indonesia, Britain and Mexico – will face a 10 percent tariff, along with 10 other countries that agreed to deal with forced labor through trade agreements signed with the United States.
Another 43 countries including Japan, China, South Korea and Australia will face a tax rate of 12.5 percent. Those rates are consistent with previous survey results,published in early June.
“Today’s action is the largest international step on workers’ rights that the United States has ever taken — that any country has ever taken,” said a senior administration official, who spoke on condition of anonymity to discuss the new tariffs. “It encourages stronger enforcement of workers’ rights abroad, will restore equity in the global marketplace for American workers, and encourages our trading partners to join the United States in eliminating forced labor from global supply chains.”
A few countries were able to reduce tariffs on their products by implementing forced labor bans after the proposed tariffs were first announced in June, including India, Trinidad and Tobago, Honduras and Sri Lanka.
While the new order maintains existing tax exemptions for a range of products such as coffee and products that comply with the 2020 North American trade agreement, the government also created more tariffs on products that cannot be produced in the United States such as cork, which comes from Portugal and gems such as diamonds and rubies from several countries.
The duties, imposed under Section 301 of the Commerce Act of 1974, will go some way to rebuilding the tariff wall cut by the Supreme Court’s February decision. Following that decision, President Donald Trump imposed a 10 percent global tariff under Section 122 of the same law. But the law only authorizes the tariffs for 150 days, and the current ones are set to expire on Friday.
Many countries still face lower tariffs than they did last year, when Trump imposed “reciprocal” duties under the International Emergency Economic Powers Act. The Supreme Court ruled that the law did not justify the tax.
China faced 20 percent tariffs on many products while the IEEPA tariffs were still in place; IEEPA tariffs on Japan and South Korea reached 15 percent; the duties of Indonesia, Malaysia, Pakistan and Thailand were 19 percent.
Top administration officials on Thursday tried to differentiate the new tariffs from those imposed earlier this year.
“I think it’s easy to just say, ‘Oh, you’re faking anything,’ because that’s not the case,” a senior administration official said. “I think it’s an easy shortcut, whether it’s analysts, or even people in the administration, to say, ‘Well, you know, we could see taxes go up.’
The U.S. Trade Representative’s office is expected to issue more tariffs after completing another Section 301 investigation that is still ongoing. A second detailed investigation into the large manufacturing capacity of 16 partners could lead to higher duties for China, the EU, Indonesia, South Korea, Vietnam, Mexico, Japan and India, among others.
Asked Thursday if the second investigation had been stopped, a senior administration official said “not at all.”
“We’re trying to be comprehensive. The issues surrounding excess structural capacity are complex,” a senior administration official said. “The investigation is ongoing.”
Another 301 investigation looks at German drug pricing practices. US Trade Representative Jamieson Greerhe told POLITICO last weekthat he has a similar investigation “waiting in the wings” if ongoing discussions with France and others on drug prices collapse.
Administration soonHe is under separate investigationin Brazilian business practices after a year-long investigation. A new 25 percent tariff on Brazilian exports is set to take effect on Wednesday, amid a major carve-out.
Ari Hawkins contributed to this report.
