"Donald Trump unveils latest tariff strategy; here's a breakdown"
President Trump's latest tariff plan has resulted in increased duties for several countries, with some facing rates higher than 15%.
Under this new regime, countries such as Brazil, Syria, Laos, Myanmar, Kazakhstan, Venezuela, India, Canada, Iraq, and the European Union (EU) and Mexico are among those affected. Brazil, for instance, faces a 50% tariff on exports to the US, while Syria, Laos, and Myanmar are subjected to a 40% tariff. Kazakhstan and Venezuela face a 25% tariff, and India and Canada have tariffs set at 25% and 35% respectively. The EU and Mexico are planning for significant reciprocal tariff increases, set to take effect on August 1, 2025.
Japan, Israel, Jordan, and Indonesia have tariffs set at exactly or slightly above 15%. Japan, for example, has a tariff rate of 15%.
This tariff increase is part of what is known as the Trump 2.0 tariff plan, with an overall baseline reciprocal tariff rate raised to 15-20% for many trading partners.
The new tariff plan has been met with legal challenges. A panel of judges appeared skeptical that Trump had the power to levy tariffs using the International Emergency Economic Powers Act. Judge Raymond Chen questioned whether a trade deficit can be considered an extraordinary and unusual threat when the US has had trade deficits for decades.
In a recent development, oral arguments for the administration's appeal of the Court of International Trade's ruling kicked off on Thursday. The Court had previously found that Trump overreached his legal authority in imposing country-specific tariffs.
Notably, the tariffs with the United Kingdom, China, and Mexico were not increased due to trade agreements. However, the deal with China expires in less than two weeks, which means those tariffs could soon increase. Mexico's tariff rate, which was previously at 25%, has been extended for another 90 days after a conversation between Trump and Mexico's president.
Canada's tariffs will go into effect on August 6, while the new tariff regime will not go into effect on August 7. The tariff rates for goods from South Korea and Japan are higher than the 10% rate that goods have been tariffed at since April.
The tariff changes evoke Trump's "Liberation Day" in April, when he similarly hiked import taxes across the board. However, the impact and long-term effects of these tariff increases remain to be seen.
- The business community is closely watching the financial implications of President Trump's tariff plan, as countries like Brazil face a 50% tariff and India a 25%, potentially affecting the general-news and politics regarding international trade.
- The reciprocal tariff increases planned by the European Union (EU) and Mexico, set to take effect in 2025, could significantly impact the finance and politics of global business relations.
