The Trump administration proposed new tariffs between 10% and 12.5% on 60 trading partners to revive Trump’s signature economic policy, which the Supreme Court ruled most were illegal.
Under the proposal, tariffs would target nations it accuses of failing to crack down on imports made with forced labor. The move uses Section 301 of the Trade Act to bypass Supreme Court rulings that previously struck down the administration's broader global tariffs The proposed tariffs are divided into two distinct tiers, based on the trade partner's existing domestic bans and enforcement against forced labor. A10% tariff rate would apply to 16 economies that have existing bans or have made commitments to block forced labor, including Canada, Mexico, European Union, United Kingdom, Taiwan and Argentina. The 12.5% tariff rate would apply to 44 economies deemed to have failed in enforcing prohibitions on forced labor, including China, Japan, South Korea, Brazil and India.
The new duties are not yet in effect, as U.S. Trade Representative Jamieson Greer is navigating a mandatory public review process. The levies are expected to be officially implemented sometime next month.
Some goods are exempt, including beef, tomatoes and coffee. The office also said it is considering a rule to allow some textiles to enter the United States at a reduced tariff rate if countries import an equal quantity of American textiles.
Tariffs, which essentially are a tax on U.S. consumers, have been a core part of the Trump administration’s economic agenda. He argues duties on imports can reduce trade deficits and quell what he views as unfair trade practices, though many economists warn that tariffs cause higher prices and lower economic growth. But the president's sweeping country-by-country tariffs were struck down in February by the Supreme Court, which ruled that an emergency powers law invoked by the government did not include the authority to impose tariffs.
Since then, Trump has sought to resurrect his tariff system using other laws. The tariffs unveiled on Tuesday hinge on Section 301 of the Trade Act of 1974, which gives the government the power to investigate alleged unfair trade practices and impose tariffs and other restrictions. Greer's office floated a separate set of 301 investigations in March, looking into 16 countries for 'structural excess capacity,' or manufacturing more goods than they can consume.
The president also used another provision of the 1974 trade law, Section 122, to temporarily impose 10% tariffs on most imports almost immediately after the Supreme Court's ruling. That law only allows tariffs for up to 150 days in response to 'large and serious … balanceof- payments deficits,' and a trade court ruled last month that the tariffs were invalid.