Trump Administration Announces Reciprocal Tariffs

On the first day of the Trump Administration, the President issued the America First Trade Policy. Among other priorities, the policy outlined the intention of the Administration to review trade agreements to ensure reciprocal and mutually advantageous free trade agreements with partner countries.

On February 13, 2025, President Trump issued a memorandum titled “Reciprocal Trade and Tariffs” instructing several agencies to investigate the harm to the United States from any non-reciprocal trade arrangements.

On April 2, 2025, President Trump signed an Executive Order and issued a Fact Sheet declaring a national emergency arising from conditions reflected in large and persistent annual U.S. goods trade deficits.

Effective at 12:01 a.m. (ET) on April 5, 2025, the United States will impose a 10% ad valorem baseline tariff on imports of all foreign-origin goods. This baseline tariff is in addition to any other applicable duties or tariffs.

Effective at 12:01 a.m. (ET) on April 9, 2025, the United States will impose country-specific tariff rates on imports from certain trading partners, which will apply even if goods are imported under a free trade agreement. These rates already include the 10% baseline tariff.

The country-specific rates included in Annex I to the executive order are:

If a country is not included in Annex I, the standard 10% duty will apply.

The additional tariffs will be assessed in addition to any other applicable duties, fees, taxes, exactions, or charges.

Duration of Tariffs

These reciprocal tariffs will remain in effect until the President Trump determines “that the threat posed by the trade deficit and underlying nonreciprocal treatment is satisfied, resolved, or mitigated.”

Exclusions

The EO specifies that the additional tariffs will apply only to the non-U.S. content of a subject article provided that at least 20 percent of the article’s value is U.S.-originating. “U.S. content” refers to the value of an article attributable to the components produced entirely, or substantially transformed in, the U.S.

The EO authorizes U.S. Customs and Border Protection to require the collection of such information and documentation regarding an imported article, including with the entry filing, as is necessary to enable it to ascertain and verify (1) the value of the U.S. content of an article and (2) whether an article is substantially finished in the U.S.

The following goods are not subject to the new reciprocal tariffs (see Annex II of the Executive Order for the full list):

• all articles that are encompassed by 50 U.S.C. 1702(b);
• (ii) all articles and derivatives of steel and aluminum subject to the duties imposed in Proclamation 9704 of March 8, 2018 (Adjusting Imports of Aluminum Into the United States), as amended, Proclamation 9705 of March 8, 2018 (Adjusting Imports of Steel Into the United States), as amended, and Proclamation 9980 of January 24, 2020 (Adjusting Imports of Derivative Aluminum Articles and Derivative Steel Articles Into the United States), as amended, Proclamation 10895 of February 10, 2025 (Adjusting Imports of Aluminum Into the United States), and Proclamation 10896 of February 10, 2025 (Adjusting Imports of Steel into the United States);
• all automobiles and automotive parts subject to the additional duties imposed in Proclamation 10908 of March 26, 2025 (Adjusting Imports of Automobiles and Automobile Parts Into the United States);
• other products enumerated in Annex II to this order, including copper, pharmaceuticals, semiconductors, lumber articles, certain critical minerals, and energy and energy products;
• all articles from a trading partner subject to the rates set forth in Column 2 of the Harmonized Tariff Schedule of the United States (HTSUS); and
• all articles that may become subject to duties pursuant to future actions under section 232 of the Trade Expansion Act of 1962.

De minimis

The EO states that duty-free de minimis treatment will remain available for all goods subject to the increased tariffs (except those imported from China) until the commerce secretary notifies the president that adequate systems are in place to “fully and expeditiously process and collect” revenue from these tariffs for articles otherwise eligible for de minimis treatment.

Mexico and Canada

Canada and Mexico will not be subject to the reciprocal tariffs as long as the existing fentanyl/migration IEEPA orders remain in effect. This means USMCA compliant goods will continue to see a 0% tariff, non-USMCA compliant goods will see a 25% tariff, and non-USMCA compliant energy and potash will see a 10% tariff. In the event the existing fentanyl/migration IEEPA orders are terminated, USMCA compliant goods would continue to receive preferential treatment, while non-USMCA compliant goods would be subject to a 12% reciprocal tariff.

China

President Trump signed a second Executive Order and issued a Fact Sheet ending duty-free de minimis treatment for covered goods from the People’s Republic of China (PRC) and Hong Kong starting May 2, 2025 at 12:01 a.m. EDT.

Imported goods sent through means other than the international postal network that are valued at or under $800 and that would otherwise qualify for the de minimis exemption will be subject to all applicable duties.

Finally, the order states that if any trading partner retaliates against the United States in response to this action, the Administration may increase or expand the duties imposed in the order.

Learn more:

• Webinar: Navigating Tariff Challenges, Mitigation Tools and Tactics
• ICYMI: Trump Administration Imposes 25% Steel and Aluminum Tariff
• Bloomberg Law: Tariff Classification Basics
• Webinar: Navigating CBP Regulations: Essential Practices for Import Success
• Webinar: Building and Maintaining an Effective Import Compliance Plan
• Webinar: Introduction to Importing

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