Full Breakdown
Trump Imposes New Forced-Labor Tariffs on 60 Trade Partners
7/25/2026, 4:09:33 AM
Core Event – New Tariff Regime Takes Effect
On July 24, the Trump administration activated a two-tier tariff schedule on imports from the United States’ 60 largest trading partners—59 countries plus the European Union—and 12.5 % for those judged not to have such bans. The measures replace a temporary global 10 % tariff that expired at 12:01 a.m. Eastern time the same day.
Background & Context
The tariffs follow a February 20 Supreme Court ruling that struck down the administration’s earlier reliance on the International Emergency Economic Powers Act. President Donald Trump invoked Section 301 of the Trade Act of 1974 after a four-month investigation (Trade Representative fact sheet).
Data & Statistics
- Scope: 60 economies, representing more than 99 % of U.S. import volume.
- Rates: 10 % or 12.5 % depending on the partner’s forced-labor record.
- Average tariff rate: 11.1 % across all U.S. imports, according to the Budget Lab at Yale Law School.
- Exemptions: Oil, gas, fertilizer, many foods, several technology products, and certain medical equipment. Thailand’s exemption list covers roughly 2,120 items; South Korea’s combined duties are capped at 15 %.
- Impact on exporters: Golden Arts Gifts & Decor (China) reports U.S. sales now at 10-20 % of prior levels, with Europe accounting for roughly 70 % of its revenue.
Official Statements & Responses
- U.S. Trade Ambassador Jamieson Greer told senators that “the problems the president’s trade policy seeks to solve are generational” and that the new duties “must be fixed” over time.
- South Korea’s trade ministry said the announcement “eased some uncertainty.”
- Australia’s Trade Minister Don Farrell called the 12.5 % tariff “completely unjustified,” emphasizing Australia’s commitment to combating modern slavery.
Criticism & Opposition
- Don Farrell (Australia) argued the United States’ claims are “unjustified.”
- Kaja Kallas, EU foreign-policy chief, questioned the grounding of the U.S. stance, noting EU labor standards include paid vacations and strong employee protections.
On-the-Ground Reports
- James Cox, managing partner at Harris Financial Group, highlighted “a gazillion exemptions” and argued the tariffs are “limited in scope.”
- Bernard Yaros, lead U.S. economist at Oxford Economics, said the exemptions “are the same as before,” covering mainly food and energy.
- Ryan Nunn, director of research at the Budget Lab, characterized the overall change as “a fairly small change,” noting the modest shift in average tariff rates.
Conflicting Reports & Gaps
Economists differ on consumer impact. Some analysts, such as William Bratton of BNP Paribas, view the lower rates and broader exemptions as “on the positive side,” suggesting limited disruption.
What’s Next
The U.S. Trade Representative’s office indicated that additional tariffs could be announced in the fall, targeting alleged “structural excess capacity” in several trading partners. A Section 301 investigation remains open for more than a dozen countries and the EU. The administration has also signaled intent to impose 50 % tariffs on selected Canadian goods within the next month, using a rarely invoked 1930 statute.
