The Trump administration is ending a period of relative calm in trade policy by rapidly implementing new tariffs, even as existing temporary duties are set to expire. U.S. Trade Representative Jamieson Greer indicated that action is imminent, with the administration planning to impose tariffs on products from dozens of economies by July 24. These new tariffs aim to maintain President Trump's tariff regime, which saw its previous iteration struck down by the Supreme Court in February and temporary stopgap measures lapse on Friday.
Specifically, the USTR proposed new Section 301 tariffs of up to 12.5% on imports from 60 economies earlier in June, citing alleged forced labor issues. Products from Canada, Mexico, the European Union, and Taiwan could face a 10% duty, while goods from China, India, and Japan might see a 12.5% levy. Adding to these, President Trump recently signed proclamations to impose staggering 50% tariffs on a range of Canadian goods within 30 days, alleging trade discrimination. The U.S. also moved last week to apply a 25% tariff on many Brazilian products.
These new tariffs are expected to build upon other recent trade actions. While the previous IEEPA-related duties, which accounted for the majority of U.S. tariff revenue last year, were struck down, the administration quickly imposed a blanket 10% tariff under Section 122 of the 1974 trade law. However, analysis by the Kiel Institute for the World Economy suggests that US consumers and businesses bear 96% of the cost of these tariffs, with the nonpartisan Tax Foundation estimating an average tax burden increase of about $700 per US household. Despite potential market volatility, some analysts like UBS do not expect a significant increase in the effective US tariff rate, predicting it will remain in a 10-15% range.
