Overview of Trump Tariffs (2025)
During his second presidency, beginning January 2025, President Donald Trump significantly escalated tariffs on imported goods, aiming to protect American industries, reduce the trade deficit, and promote domestic manufacturing. These tariffs, often referred to as the “Liberation Day” tariffs, have sparked global economic debates, legal challenges, and retaliatory measures from trading partners. Below is a concise summary of the key aspects based on available information.
Key Tariff Policies
1. Universal and Reciprocal Tariffs:
• On April 2, 2025, Trump declared a national emergency under the International Emergency Economic Powers Act (IEEPA) to impose a 10% baseline tariff on imports from most countries, effective April 5, 2025. Higher “reciprocal” tariffs were applied to countries with large trade deficits with the U.S., effective April 9, 2025.
• The average effective U.S. tariff rate rose from 2.5% at the start of Trump’s second term to 27% due to these measures, before settling at 15.1% after rollbacks as of June 1, 2025.
2. Steel and Aluminum Tariffs:
• On March 12, 2025, tariffs on steel and aluminum imports were set at 25%, expanding on first-term policies. On June 4, 2025, these were doubled to 50% to counter foreign overproduction and protect U.S. industries.
• The U.K. was temporarily exempted from the 50% rate, maintaining a 25% tariff pending a trade deal, with potential changes by July 9, 2025.
• Goods compliant with the USMCA (U.S.-Mexico-Canada Agreement) are exempt from certain tariffs, though non-compliant goods face 25% tariffs (or 12% if fentanyl/migration-related IEEPA tariffs are lifted).
3. China-Specific Tariffs:
• Tariffs on Chinese imports escalated to 145% in April 2025, prompting China to impose 125% retaliatory tariffs on U.S. goods and restrict rare earth exports.
• A May 2025 truce in Geneva reduced U.S. tariffs on China to 30%, with China lowering its tariffs to 10%. A subsequent deal in London (June 2025) maintained a 55% total tariff on Chinese goods (including pre-existing duties) in exchange for China easing rare earth export restrictions for six months and facilitating Chinese student access to U.S. colleges.
4. Fentanyl and Migration-Related Tariffs:
• Tariffs on Canada, Mexico, and China were imposed under IEEPA to address fentanyl trafficking and migration, with 25% tariffs on non-USMCA-compliant goods from Canada and Mexico. These were ruled illegal by the U.S. Court of International Trade in May 2025 but remain in effect pending appeal.
5. Other Targeted Tariffs:
• A 100% tariff was proposed on foreign films to protect the U.S. film industry, citing national security and job losses. No final decision has been confirmed.
• A 17% tariff was imposed on Israeli goods, leading to negotiations with Israel offering to remove tariffs on U.S. goods.
• Automobiles, auto parts, and other goods like copper and electronics face specific tariffs, with exemptions for certain products (e.g., semiconductors, pharmaceuticals).