US Plans to Increase Tariffs Amid Trade Policy Adjustments
US Trade Representative Discusses Tariff Increases
On Wednesday, US Trade Representative Jamieson Greer announced that the United States is set to elevate tariffs on various countries from the current 10% to potentially 15% or more. This statement marks a significant step in the ongoing trade policy adjustments of the Trump administration. During an appearance on Fox Business Network’s "Mornings with Maria," Greer indicated that the existing 10% temporary tariff would not be maintained for long for certain trading partners. He stated, "Currently, we have a 10% tariff. It will increase to 15% for some, and possibly higher for others, aligning with the tariffs we've been implementing." In a subsequent interview with Bloomberg TV, he confirmed that the White House is preparing to issue a proclamation to raise these temporary tariffs to 15% where deemed appropriate, while also considering countries that have established trade agreements with the US, although he refrained from naming specific nations.
No Plans for Increased Tariffs on China
No escalation beyond current China tariffs
Greer clarified that there are no intentions to raise tariffs on Chinese imports beyond the existing levels, even with President Trump's upcoming visit to China. He emphasized, "We don't plan to escalate beyond the current rates. We aim to adhere to the agreement we have with them." However, he noted that tariffs on China, Vietnam, and other nations remain essential due to ongoing concerns regarding excessive industrial capacity and state support for domestic companies. He remarked, "I don't believe they will fully resolve that issue, which is why we need to maintain tariffs on China, Vietnam, and other countries facing similar challenges."
New Legal Framework for Tariffs
Legal route to replace struck-down tariffs
The administration is also swiftly working to establish a new legal framework to replace emergency tariffs that were invalidated by the Supreme Court. This new approach will utilize various legal provisions under US trade law. Temporary tariffs under Section 122 of the Trade Act of 1974 have already been implemented at a 10% rate. Moving forward, the administration intends to focus on: Section 301 investigations aimed at addressing unfair trade practices, including excessive capacity, forced labor in supply chains, discrimination against US technology firms, and subsidies in sectors like rice and seafood; Section 232 national security investigations, previously applied to steel and aluminum tariffs; and the potential application of Section 338 of the Tariff Act of 1930, which permits tariffs of up to 50% on countries that discriminate against US trade. Greer emphasized the importance of adhering to legal processes, acknowledging the likelihood of legal challenges, stating, "Whenever we impose a tariff, foreign interests will seek to contest it. Legal actions are expected." He also mentioned that Section 301 investigations could serve as enforcement mechanisms for recently established trade agreements. For example, the US plans to initiate a Section 301 investigation into Indonesia’s trade practices, despite a prior agreement where Indonesia accepted a 19% US tariff and expanded market access for American products. "We will determine the appropriate tariff to apply, ensuring continuity in our trade agreements," he concluded.