Second Trump Tariffs

Tariffs during the second presidency of Donald Trump have reflected an escalation of protectionist trade policies in the United States, with President Donald Trump announcing a series of high import tariffs impacting all trading partners. While his first administration imposed tariffs on approximately $380 billion in imports, the total under his second administration is projected to exceed $1.4 trillion by April 2025.

Trump resumed a trade war with China, raising tariffs on the country to an effective 54% after April 9. He launched a second trade war with Canada and Mexico by imposing a 25% tariff on most Canadian and Mexican goods, but later exempted all USMCA-compliant goods indefinitely. Trump framed the actions as a way to hold these countries accountable for contraband drug trafficking and illegal immigration while supporting domestic manufacturing. On March 12, 2025, a 25% global tariff on steel and aluminum products went into effect.

On April 2, a day Trump nicknamed "Liberation Day", Trump announced 10% universal import duty on all goods brought into the U.S. as well as even higher rates for 60 nations. The 10% baseline tariff takes effect on April 5 while the additional rates begin April 9. On April 3, a 25% tariff on all imported automobiles will go into effect, with auto parts expected to follow. Canada, China, and the European Union have announced counter-tariffs, while other countries began proactive negotiations to prevent additional trade disputes.

Background

Since the 1980s, Trump has advocated for import tariffs as a tool to regulate trade and retaliate against foreign nations that he believes have been "ripping off" Americans. In his campaigns for U.S. presidency, Trump promised to use tariffs to achieve a wide range of goals including preventing war, reducing trade deficits, improving border security, and subsidizing childcare. Although Trump has said foreign countries pay his tariffs, U.S. tariffs are fees paid by U.S. consumers and businesses either directly or in the form of increased prices. Shortly after being reelected to a second term, Trump acknowledged that tariffs might cause "some pain" for Americans but insisted "it will all be worth the price that must be paid".

During his first term, Trump imposed tariffs on steel and aluminum imports, resulting in price increases for Americans. In December 2021, a metric ton of hot-rolled band steel was $1,855 in the U.S. compared to $646 in China and $1,031 in Europe. The World Trade Organization later ruled that the implementation violated global trade rules. While he and his first successor, Joe Biden, rolled back some of these tariffs, most remained in place by the start of Trump's second term. Trump also launched a trade war with China which subjected 60% of U.S.-China trade to 20% tariffs and was widely characterized as a failure for the United States.

In May 2019, Trump used tariff threats of up to 25% on Mexico to negotiate an expansion of his "Remain in Mexico" policy and the deployment of Mexican soldiers to help control illegal immigration. Mexico deployed nearly 15,000 troops to its border with the U.S. and 6,500 troops to its border with Guatemala. In 2020, the U.S., Mexico and Canada renegotiated NAFTA as the United States–Mexico–Canada Agreement (USMCA) and recommitted to 0% tariffs on most products traded between them. Five weeks after the USMCA went into effect, Trump used an exemption for national security concerns to implement a 10% tariff on Canadian aluminum after claiming it was flooding the U.S. market. He withdrew the tariff a month later, three hours before Canada planned to retaliate.

Planning

While campaigning for his second term as U.S. president, Trump pledged even larger tariffs than his first term, including 60% on China, 100% on Mexico, and 20% on all other countries. He also proposed tariffs to penalize U.S. companies that outsourced manufacturing, such as a 200% tariff on John Deere. Additionally, Trump suggested replacing income taxes with tariff revenue—an idea economists from the Tax Foundation deemed "mathematically impossible."

Trump appointed close economic advisor Peter Navarro as his Senior Counselor for Trade and Manufacturing. Navarro had been recently imprisoned for defying congressional subpoenas related to his role in attempts to overturn the 2020 election, including his " Green Bay Sweep" strategy. Navarro wrote books criticizing corporations for prioritizing profits over American jobs and arguing that traditional economic analysis overlooks the harm free trade can inflict on people's lives. He advocates a permanent regime of trade barriers to balance the trade deficit. Navarro had served in high-ranking trade roles during Trump's first term but was often rebuffed by free market-minded Trump administration officials such as Gary Cohn, who resigned in protest of Trump's 2018 steel and aluminum tariffs. The Financial Times reported Navarro would receive more influence and less opposition in Trump's second administration. Navarro began working closely with cabinet nominees Howard Lutnick and Jamieson Greer.

During his inaugural address on January 20, 2025, Trump pledged to "immediately begin the overhaul of our trade system to protect American workers and families. Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens."

On March 4, 2025, the U.S. notified the World Trade Organization, a watchdog for international trade, that it would suspend planned contributions indefinitely. The U.S. was set to provide about 11% of the WTO's $232 million 2024 budget, a fee based on the country's share of global trade. UPS launched a tool allowing online shoppers to view the added cost of tariffs at checkout instead of being surprised by additional costs when their parcel arrived.

Legality

During his first term, Trump placed tariffs on steel and aluminum imports under Section 232 of the Trade Expansion Act (TEA). The act allows the U.S. President to modify imports without involving Congress if the Secretary of Commerce conducts an investigation, holds public hearings, and determines that imports threaten national security. Trump renewed these tariffs in his second term while terminating prior exemptions. Trump also reinitiated investigations that he previously used to threaten tariffs under Section 301 of the Trade Act of 1974.

At the start of his second term, Trump invoked the National Emergencies Act (NEA) and the International Emergency Economic Powers Act (IEEPA) by declaring multiple "national emergencies" related to border security, illegal immigration, and energy. Declaring these emergencies allowed Trump to enact tariffs without involving Congress or following the procedures required by TEA or other trade statutes. While the IEEPA had been used for sanctions, it had never before been used for tariffs. As he signed the orders, Trump stated that declaring an emergency "means you can do whatever you have to do to get out of that problem."

To end a national emergency under the NEA, a member of Congress can file a privileged resolution requiring a congressional vote within 15 days. In February 2025, Democrats Tim Kaine and Mark Warner forced a vote on terminating Trump's national emergency on energy, but the Senate's Republican majority defeated it. Kaine and other Democrats planned votes to end the emergencies justifying tariffs on Canada and Mexico, but a provision added to the March 2025 budget bill blocked the process by declaring that the remainder of the year "shall not constitute a calendar day for purposes of section 202 of the National Emergencies Act".

Multinational tariffs

Steel and aluminum tariffs

On March 12, 2025, the U.S. imposed 25% tariffs on all steel and aluminum imports, aiming to strengthen domestic production. Commerce Secretary Howard Lutnick said Trump would soon add a copper tariff as well. The EU and Canada announced counter-tariffs, while Australia, Britain, Japan, and Brazil criticized the move but withheld retaliation. On April 2, 2025, aluminum tariffs expanded to include empty aluminum cans and canned beer.

The measures expanded Trump's first-term steel and aluminum tariffs by eliminating all exemptions and raising the aluminum tariff from 10% to 25%. The administration argued previous exemptions "inadvertently created loopholes that were exploited by China and others with excess steel and aluminum capacity". Trump also mandated that steel be "melted and poured" and aluminum "smelted and cast" in the U.S. to qualify for duty-free status to prevent tariff circumvention.

In 2023, the U.S. imported 44% of its aluminum and 26% of its steel. Canada was its largest supplier of both, accounting for more than half of aluminum and two-thirds of primary aluminum imports. While the U.S. was the world's largest producer of aluminum through 2000, it accounted for less than 2% of global supply by 2021, largely due to high electricity costs that made it less competitive in the global market. In 2021, primary aluminum smelters operated at 55% capacity in the U.S., compared to 95% in Canada and 88% globally. The U.S. remained a major producer of the less energy-intensive secondary aluminum, but secondary aluminum is less desirable for defense or electronics.

Car and auto part tariffs

In January 2025, President Trump announced broad tariffs on Canada and Mexico, threatening the highly integrated North American auto supply chain. Due to decades of free trade agreements including USMCA, factories in the U.S., Canada, and Mexico grew accustomed to shipping auto parts back and forth multiple times during the manufacturing process. The three largest U.S. automakers—Ford, General Motors, and Stellantis—lobbied for exemptions, warning the tariffs would hurt American companies more than foreign competitors. Ford CEO Jim Farley warned investors, "Long term, a 25% tariff across the Mexico and Canadian border will blow a hole in the U.S. industry that we have never seen." Trump delayed tariffs on USMCA-compliant vehicles and the next day extended the exemption to all USMCA-compliant goods. Although Trump said this exemption would expire April 2, the White House announced that day it would continue indefinitely.

Still, non-USMCA compliant brands manufacturing in Canada or Mexico, such as BMW, were affected starting March 4, 2025. BMW chose to cover these tariffs until May 1, 2025. On March 26, Trump announced a 25% tariff on all imported cars beginning April 3 and on non-U.S. content in domestically assembled vehicles "no later than May 3". The White House argued the move would boost domestic manufacturing and generate $100 billion in tax revenue, noting that about 50% of the 16 million cars bought by Americans in 2024 were imported.

Reciprocal tariffs

On February 13, 2025, President Trump directed his staff to research custom reciprocal tariffs for every country, factoring in existing tariffs, trade balances, and value-added taxes, with a report due in 180 days. Lutnick said his team would have a plan ready by April 1. Trump later announced the reciprocal tariffs would take effect on April 2, 2025, a day he nicknamed "Liberation Day". A baseline 10% tariff on most trading partners will go into effect at 12:01 a.m. on April 5, while higher reciprocal rates will take effect at 12:01 a.m. on April 9. The White House confirmed the new tariffs would stack on top of previous orders for China, resulting in an effective 54% tariff on imports from China after April 9.

Reuters reported trade officials struggled to design the tariffs because each of the 186 members of the World Customs Organization carried different duty rates. The administration initially considered dividing all countries into three tiers of high, medium, and low tariffs. Later, officials Scott Bessent and Kevin Hassett told Fox Business that the administration would focus on the U.S.'s largest trading partners and assign each an individualized rate. Hassett stated there were “more than 100 countries that don’t really have any tariffs on us and don’t have any non-tariff barriers” and that just "10 to 15 countries" were a concern. However, on March 30 Trump told reporters, "I don't know who told you 10 or 15", dismissing the idea as a "rumor" and saying he intended to impose tariffs on "all countries". While many countries attempted to negotiate deals in the weeks leading up to April 2, no exemptions were expected.

The lack of clarity contributed to high economic uncertainty and stock market declines, making March the worst month since December of 2022 for the U.S. stock market, with the S&P 500 losing well over 5% that month, and the NASDAQ over 10% that quarter. The Dow Jones Industrial Average was also down since the beginning of the year, as of the final day of March.

ING Group commented that plans for the policy aligned with Navarro's section of Project 2025, titled "The Case for Fair Trade". The section highlighted China, India, the EU, Thailand, Taiwan, Vietnam, Japan, and Malaysia as primary targets due to their high trade surpluses with the U.S. or significant tariff disparities.

Russia was not on the list of countries, despite even uninhabited islands and territories of countries being on the list.

Additional proposals

Digital Sales Tax investigation

On February 21, 2025, Trump issued a presidential memorandum ordering the Office of the United States Trade Representative (USTR) as well as other officials, including Peter Navarro, to investigate digital service taxes (DSTs) and determine whether to take retaliatory action. A fact sheet accompanying the memo emphasized the European Union’s Digital Markets Act (DMA) and Digital Services Act (DSA) would face scrutiny.

DSTs are taxes on revenue from digital services such as online advertising and selling user data. These taxes allow countries to collect revenue from multinational companies that provide digital services in their jurisdiction. USTR investigations initiated during Trump's first term led to tariff threats on several countries under authority granted by section 301 of the Trade Act of 1974. On October 8, 2021, over 135 countries participating in the OECD negotiations agreed on a two-pillar approach to reform and withdraw DSTs called the " Global tax deal". The Pillar One deadline was December 31, 2023, but was subsequently extended to December 31, 2024. As of January 2025, Trump withdrew from Pillar Two of the agreement, and many countries' DSTs remain in effect.

Secondary tariffs

"Secondary tariffs" are a new trade policy introduced by the second Trump administration that resembles secondary sanctions. Unlike primary tariffs, which directly target a specific country, secondary tariffs penalize the third-party countries or entities that trade with the targeted nation.

On March24, following actions such as the March 2025 Venezuelan deportations, Trump signed an executive order imposing a 25% tariff on nations that purchase oil from Venezuela at the Secretary of State's discretion. He subsequently threatened secondary tariffs on countries buying Russian oil, unless Russia agreed to a peace treaty with Ukraine, and on countries that trade with Iran.

''De minimis'' exemption

Trump's February 2025 executive orders announcing tariffs on imports from China, Mexico, and Canada initially suspended the U.S. ''de minimis'' exemption. The ''de minimis'' exemption waives standard customs procedures on low-value packages to reduce administrative burdens. U.S. Congress quadrupled the ''de minimis'' threshold from $200 to $800 in 2016, resulting in an over 1000% increase in shipments claiming the exemption by 2023. The U.S. exemption was among the highest globally, over 5x the size of the European Union's, and used by many companies to send goods to the U.S. without close inspection or taxes. The largest beneficiaries were Chinese e-commerce companies such as Shein and AliExpress. Some shipments were linked to drug trafficking. However, by February 7, 2025, Trump indefinitely restored the ''de minimis'' exemption for all three target countries to avoid overwhelming U.S. customs officials.

On April 2, 2025, Trump signed a new order to close the exemption for China and Hong Kong starting May 2, 2025. The Secretary of Commerce is expected to submit a report within 90 days to assess the impact and consider whether to close the exemption for Macau. Republican Senators Mitch McConnell, Rand Paul, Lisa Murkowski, and Susan Collins, joined a Democratic led bill to block Trump's Canadian tariffs.

Country-specific tariffs

China

On February 1, 2025, Trump signed Executive Order 14195 establishing a new 10% tariff on all Chinese imports. The order, which went into effect on February 4, came at the behest of the National Security Council. On February 10 China retaliated with tariffs of 15% on coals and liquefied natural gas and 10% on oil and agricultural machines. China also added PVH Corp. and Illumina to the Unreliable Entity List, launched an antitrust investigation into Google, and added export controls to some metals including tungsten.

Capital Economics, a UK-based macroeconomic research consultancy, estimated that while the U.S. levied new tariffs on about $450 billion worth of Chinese goods, China's additional tariffs only targeted about $20 billion of U.S. goods. Julian Evans-Pritchard, the firm's head of China Economics, stated "The measures are fairly modest, at least relative to U.S. moves". Reuters said China's "limited" response "underscored an attempt by Chinese policymakers to engage Trump in talks to avert an outright trade war".

On March 4, 2025, Trump raised tariffs on Chinese imports again from 10% to 20%. In response, China announced the same day that it would impose a 15% tariff on U.S. chicken, wheat, corn, and cotton, as well as a 10% tariff on U.S. sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables, and dairy products, effective March 10, 2025. Additionally, China launched an anti-circumvention investigation into optical fiber products imported from the United States. The General Administration of Customs of China suspended U.S. lumber imports and revoked soybean import licenses for three U.S. firms. On March 30, 2025, China, South Korea, and Japan reached an agreement at a meeting of top trade officials to strengthen their free trade ties, including supply-chain cooperation, in response to Trump tariffs.

Retailer Walmart had asked some Chinese suppliers to lower prices due to tariffs. On March 12, 2025, China's Ministry of Commerce held talks with Walmart, according to state media reports. Costco, a warehouse club chain, also took the same measures to Chinese suppliers.

On March 26, 2025, Trump suggested he might reduce tariffs on China to reach a deal on a sale of TikTok.

Canada and Mexico

On November 25, 2024, after winning reelection, Trump announced a 25% tariff on all imports from Canada and Mexico unless they took action against illegal immigration and drug trafficking, particularly fentanyl. Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau sought to de-escalate tensions. While Trudeau noted that less than 1% of illegal border crossings and less than 1% of fentanyl into the U.S. come from Canada, he unveiled a $1.3 billion security plan for the Canada–U.S. border on December 16, 2024. Despite these efforts, on January 31, 2025 the U.S. confirmed the tariffs would take effect on February 4, with a reduced 10% rate for Canadian energy products. Bloomberg News reported that Trump advisors Peter Navarro and Stephen Miller led the economic discussions on the tariffs.

Trudeau and Sheinbaum condemned Trump's actions and threatened immediate economic retaliation, but on February 3 the three leaders negotiated a one-month delay on the tariffs. As part of the agreement, Mexico committed to deploying 10,000 troops to its border with the United States, while Canada pledged to appoint a "fentanyl czar" and continue implementing the border security plan announced in 2024. In return, Trump pledged to take measures to curb weapons trafficking to Mexico and to collaborate with Canada on a joint anti-crime "strike force". However, on February 27, Trump claimed "Drugs are still pouring into our Country from Mexico and Canada" and reaffirmed his planned tariffs, leading to their implementation on March 4, 2025. Canada retaliated with 25% tariffs on $20 billion () in U.S. goods, with plans to expand to $85 billion (), while Mexico prepared its response for March 9. The Wall Street Journal warned the tariffs had "the potential to profoundly reshape relations between the U.S. and two of its biggest trading partners, abruptly reversing America’s decades-long project of expanding free trade with its allies."

The onset of the trade war triggered stock market declines and economic concerns, particularly for retailers and car manufacturers. Lutnick quickly signaled tariff reductions. "The president is listening to the offers from Mexico and Canada. He’s thinking about trying to do something in the middle," he said on March 5. The same day, Trump delayed tariffs on USMCA-compliant automakers. The next day, he extended the delay to all USMCA-compliant goods—covering 50% of Mexican and 38% of Canadian imports—until April 2. The Mexican government expected the amount of compliant goods would increase to 85–90% within weeks. Canada said it would maintain its initial tariffs but pause planned increases. Tens of thousands of Mexicans celebrated with Sheinbaum in Mexico City's central plaza.

Canada, the U.S.'s largest supplier of steel and aluminum, was significantly impacted by U.S. tariffs on the metals which took effect on March 12. Canada retaliated the next day with 25% tariffs on an additional $20.6 billion () of U.S. goods. On March 26, Trudeau's successor, Prime Minister Mark Carney, called Trump's auto tariffs a "direct attack" and said he would convene a cabinet meeting the next day to plan a response.

Europe

European Union

Before his second inauguration, Trump threatened to impose tariffs on Europe unless it reduced its trade surplus with the U.S. by increasing imports of American cars, agricultural products, and oil and gas. The US and the European Union traded a record $1.6 trillion in 2023. The European Commission pointed out that while the U.S. ran a trade deficit with the EU in goods, it was offset by a trade surplus in services. On February 2, 2025, Trump told reporters he planned to impose tariffs on the European Union "pretty soon". He also suggested tariffs on the UK "might happen" but believed "that one can be worked out".

Some EU leaders threatened immediate retaliation while others expressed concerns about reigniting global inflation. "We have to do everything to avoid this totally unnecessary and stupid tariff war," said Polish Prime Minister Donald Tusk. On February 4, 2025, EU trade ministers met in Warsaw to discuss the U.S. president's threats. On February 7, 2025, the EU proposed lowering tariffs on car imports from 10% to closer to the U.S.'s 2.5% rate and to increase purchases of American liquefied natural gas and military equipment. On February 25, French President Emmanuel Macron met with Trump at the White House and aimed to persuade him to refrain from initiating a trade war with Europe and to concentrate on China instead.

On March 12, after Trump's global steel and aluminum tariffs took effect, the European Union announced a two-phase retaliatory plan. Initially scheduled to begin April 1, both phases were postponed to mid-April. Phase one is reinstating tariffs imposed in 2018 and 2020 in response to Trump’s first-term metal tariffs. These measures, valued at €6.3 billion in 2018 but reduced to €4.5 billion in 2025 due to Brexit and declining U.S.-EU trade, were suspended in 2023 after negotiations with then-president Joe Biden. Phase two introduces tariffs targeting €18 billion worth of U.S. industrial and agricultural goods, including steel, aluminum, home appliances, wood products, poultry, beef, and other food imports. Trump condemned the EU’s planned 50% tariff on U.S. whiskey and threatened to impose 200% tariffs on European alcohol in response.

In the lead-up to the imposition of Trump's reciprocal tariffs, Bernd Lange, Chairman of the INTA, proposed retaliating with "tariffs on digital services on which the US has a huge surplus".

United Kingdom

The United Kingdom chose not to retaliate against President Trump’s metal tariffs. Chancellor Rachel Reeves of the Labour Party stated that discussions were "ongoing" regarding a potential reduction of the UK’s Digital Services Tax (DST) to prevent further trade disputes with the United States. Introduced in 2020, the UK’s DST imposes a 2% levy on large digital companies, generating approximately £800 million annually. The proposal to reduce the tax faced criticism from the Liberal Democrats, who condemned it as a "tax handout to Elon Musk, Zuckerberg, and other U.S. tech barons" and instead advocated for an increase to 6%.

India

Indian Prime Minister Narendra Modi visited the White House in February to negotiate tariffs and advance a deal aimed at doubling bilateral trade to $500 billion by 2030. India's trade-weighted average tariff was 12%, compared to the United States' 2.2%, leading to Trump nicknaming and repeatedly calling the country "tariff king", "tariff abuser" and a "big abuser" of trade ties. Analyses projected reciprocal tariff measures would have significant economic impacts to India. Citi Research estimated that India could lose $7 billion annually. An internal Indian analysis estimated that reciprocal tariffs would affect 87% of its total exports to the U.S., valued at $66 billion. India estimated increases of 6% to 10% in tariffs on items such as pearls, mineral fuels, and machinery, and the $11 billion worth of pharmaceutical and automotive exports would see the highest impact.

India took several steps to address trade concerns. In February, it reduced tariffs on motorcycles and whiskey, pledged to review additional tariffs, and offered to increase U.S. energy and defense equipment imports. The following month, Reuters reported that India was negotiating a trade agreement with the U.S. and was open to lowering or eliminating tariffs on 55% of its imports from the U.S., valued at $23 billion, which were currently subject to tariffs ranging from 5% to 30%. India warned the offer was contingent on relief from reciprocal tariffs and said decisions were not final.

Other countries

On January 26, 2025, a dispute arose between Colombia and the U.S. after Colombian president Gustavo Petro refused to allow the landing of two U.S. military aircraft carrying deported Colombian nationals. Petro called the treatment of deportees on military flights undignified and said he would accept deportation flights on civilian planes. In response, Trump ordered retaliation against Colombia and its officials, including 25 percent tariffs that would increase to 50 percent in one week if Petro did not reverse his position. Petro responded by ordering a 25 percent tariff on the U.S. that would also increase to 50 percent. Hours later, the U.S. said Colombia had agreed to "unrestricted acceptance" of deportees, including on military aircraft. Colombia said it would "continue to receive" deported Colombians and would guarantee them "dignified conditions."

In November 2024 and again in January 2025, Trump attempted to threaten BRICS countries saying they would face 100% tariffs if they attempted to replace the U.S. dollar as a reserve currency. On March 24, 2025, Trump threatened to impose tariffs of 25% on imports from countries that purchase oil and gas from Venezuela.

Impact assessments

United States

Although Trump's first term economic policy featured lower and more targeted tariffs with many exceptions, such as an exception for Apple products, Trump promised higher rates, broader impacts, and few exceptions in his second term. According to the Tax Foundation, the first Trump administration imposed new tariffs on approximately $380 billion worth of imports. Comparatively, the second Trump administration was expected to impact more than $1.4 trillion of imports by April 2025.

At the start of his second term, confusion over rapidly fluctuating tariff levels and other economic policies created significant uncertainty for businesses and economists. U.S. GDP grew by 2.8% in 2024, the year before Trump’s inauguration. In March 2025, the Federal Reserve lowered its 2025 growth forecast from 2.1% to 1.7%, while the OECD projected a decline to 2.2% in 2025 and 1.6% in 2026. The Federal Reserve also increased average inflation expectations from 2.5% to 2.7%.

The expected impact of the threatened 25% tariffs on Mexican and Canadian goods is high. Grocery prices were expected to rise as two-thirds of U.S. vegetable imports came from Mexico. PIIE estimated that such a tariff retained through 2029 would reduce the gross domestic product of the United States by billion. According to the Budget Lab at Yale University, American households would lose approximately in purchasing power.

The Council on Foreign Relations notes the energy sector of the American economy is expected to be among the most impacted by tariffs. A 10% tariff on Canadian energy imports is expected to increase energy prices for American consumers, in part, because Canada is the biggest supplier of energy to the United States, including 61 percent of crude oil imports in 2021. American refineries, particularly in the Midwest, rely on crude oil to process into gasoline, and projections indicate that gas prices could increase up to 50 cents per gallon in the region due to tariffs. On February 2, 2025, Canadian company Irving Oil released a statement, noting, “The majority of the product produced at our Saint John refinery is bound for the U.S. market… This tariff will result in price increases for our U.S. customers and have impacts on energy security and the broader economy.” During his campaign, Trump promised voters he would cut energy prices in half during his first year in office.

Economist Michael Hudson has argued that the tariffs have the potential to disrupt the global economy by disrupting the balance of payments between the United States and its foreign debtors. By reducing the export trade between the United States and countries targeted by the tariffs and raising the cost of dollar-denominated goods, the US makes it more difficult for those countries to pay their dollar debts. Hudson believes this could cause a debt crisis, and compares it to the historical examples of the Latin American debt crisis and the inter-allied repayment of loans during the World Wars.

China

Nomura Holdings estimated that eliminating the U.S. ''de minimis'' exemption for Chinese goods "would slow Chinese export growth by 1.3 percentage points and GDP growth by 0.2 point". When the U.S. Congress raised the de minimis limit from $200 to $800 in 2016, they sparked a surge in U.S. imports of cheap Chinese goods. A 2023 U.S. House Select Committee report estimated that "nearly half" of all de minimis shipments originated from China and that Chinese e-commerce companies. Temu and Shein, estimated to comprise more than 30% of daily de minimis exemptions to the U.S., onboarded more sellers with a physical presence in the U.S. and expanded their distribution facilities beyond China to mitigate the impact of losing the U.S. de minimis exemption.

On February 7, 2025, Trump suspended closing the exemption for China until the Secretary of Commerce notified him that adequate systems to process and collect tariff revenue were in place. The exemption is expected to be closed again on May 3, 2025.

Other countries

Ontario Premier Doug Ford stated that the tariffs would likely impact around half a million jobs in the province's automotive industry. Peterson Institute Director of Studies Marcus Nolands believed the tariffs would cause deindustrialization in Mexico.

Summary table

Reciprocal tariffs by country

See also

*Tariffs in the first Trump administration
*2025 United States trade war with Canada and Mexico
*China–United States trade war

*List of the largest trading partners of the United States
*

Notes

References

External links

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