Higher US tariffs kick in for dozens of trading partners

Higher US tariffs kick in for dozens of trading partners

By Beiyi SEOW

Washington (AFP) Aug 7, 2025

The United States began charging higher tariffs on dozens of trading partners Thursday, in a major escalation of President Donald Trump’s drive to reshape global commerce in America’s favor.

Shortly before the new levies kicked in, the United States separately announced it would double tariffs on India to 50 percent and hit many semiconductor imports from around the world with a 100-percent levy.

As an executive order signed last week by Trump took effect, US duties rose from 10 percent to levels between 15 percent and 41 percent for a list of trading partners.

Many imports from economies including the European Union, Japan and South Korea now face a 15-percent tariff, even with deals struck with Washington to avert steeper threatened levies.

But others like India face a 25-percent duty — to be doubled in three weeks to 50 percent — while Syria, Myanmar and Laos face staggering levels at either 40 percent or 41 percent.

Switzerland’s government, which failed to convince Trump not to impose a stinging 39-percent tariff, was set to hold an extraordinary meeting later Thursday.

Taking to his Truth Social platform just after midnight, Trump posted: “IT’S MIDNIGHT!!! BILLIONS OF DOLLARS IN TARIFFS ARE NOW FLOWING INTO THE UNITED STATES OF AMERICA!”

The latest wave of “reciprocal” duties, aimed at addressing trade practices Washington deems unfair, broadens the measures Trump has imposed since returning to the presidency.

– ‘No charge’ –

On the eve of his latest salvo, he doubled planned duties on Indian goods to 50 percent, citing New Delhi’s continued purchase of Russian oil.

The new levy — up from 25 percent now — would take effect in three weeks.

The Federation of Indian Export Organisations called the move a “severe setback for Indian exports, with nearly 55 percent of our shipments to the US market directly affected.”

Trump’s order also threatened penalties on other countries that “directly or indirectly” import Russian oil, a key revenue source for Moscow’s war in Ukraine.

Washington has already separately stuck tariffs on sector-specific imports such as steel, autos, pharmaceuticals and chips.

Trump said Wednesday he also planned an “approximately 100 percent tariff” on semiconductor imports, but with “no charge” for companies investing in the United States or committed to do so.

Shares in Taiwanese chip-making giant TSMC surged as Taipei said it would be exempt, but some other Asian manufacturers took a beating.

Companies and industry groups warn that the new levies will severely hurt smaller American businesses, while economists caution that they could fuel inflation and weigh on growth in the longer haul.

With the dust settling on countries’ tariff levels, at least for now, Georgetown University professor Marc Busch expects US businesses to pass along more of the bill to consumers.

– ‘This will matter’ –

An earlier 90-day pause in these higher “reciprocal” tariffs gave importers time to stock up, he said.

But although the wait-and-see strategy led businesses to absorb more of the tariff burden initially, inventories are depleting and it is unlikely they will do this indefinitely, he told AFP.

“With back-to-school shopping just weeks away, this will matter politically,” said Busch, an international trade policy expert.

The tariff leaves lingering questions for partners that have negotiated deals with Trump recently.

Tokyo and Washington, for example, appear at odds over key details of their trade pact, in particular on when lower levies on Japanese cars will take place.

Generally, US auto imports now face a 25-percent duty under a sector-specific order. Toyota has cut its full-year profit forecast by 14 percent because of the tariffs.

Japan and the United States also appear to differ on whether the “reciprocal” tariffs of 15 percent on other Japanese goods would be on top of existing levies or — like the EU — be capped at that level.

China and the United States meanwhile currently have a shaky truce in their trade war but that is due to expire on August 12.

Chinese exports to the United States tumbled 21.7 percent last month, official data showed on Wednesday, while those to the European Union jumped 9.2 percent and to Southeast Asia by 16.6 percent.

– New fronts –

Meanwhile, the EU is seeking a carveout from tariffs for its key wine industry.

In a recent industry letter addressed to Trump, the US Wine Trade Alliance and others urged the sector’s exclusion from tolls, saying: “Wine sales account for up to 60 percent of gross margins of full-service restaurants.”

Trump has separately targeted Brazil over the trial of his right-wing ally, former president Jair Bolsonaro, who is accused of planning a coup.

US tariffs on various Brazilian goods surged from 10 percent to 50 percent Wednesday, but broad exemptions including for orange juice and civil aircraft are seen as softening the blow. Still, key products like Brazilian coffee, beef and sugar are hit.

Trump targets tariff evasion, with eye on China
Washington (AFP) Aug 6, 2025 –
As the United States ramps up tariffs on major trading partners globally, President Donald Trump is also disrupting strategies that could be used — by Chinese companies or others — to circumvent them.

Goods deemed to be “transshipped,” or sent through a third country with lower export levies, will face an additional 40-percent duty under an incoming wave of Trump tariffs Thursday.

The latest tranche of “reciprocal” tariff hikes, taking aim at what Washington deems unfair trade practices, impacts dozens of economies from Taiwan to India.

The transshipment rule does not name countries, but is expected to impact China significantly given its position as a manufacturing powerhouse.

Washington likely wants to develop supply chains that are less reliant on China, analysts say, as tensions simmer between the world’s two biggest economies and the US sounds the alarm on Beijing’s excess industrial capacity.

But “it’s a little more about the short-term effect of strengthening the tariff regime than it is about a decoupling strategy,” said Josh Lipsky, chair of international economics at the Atlantic Council.

“The point is to make countries worried about it and then have them err on the side of not doing it, because they know that Trump could then jack up the tariff rates higher again,” he added, referring to tariff evasion.

The possibility of a sharply higher duty is a “perpetual stick in the negotiations” with countries, said Richard Stern, a tax and budget expert at the conservative Heritage Foundation.

He told AFP that expanding penalties across the globe takes the focus away from Beijing alone.

– Alternative supplies –

Experts have noted that Vietnam was the biggest winner from supply chain diversions from China since the first Trump tariffs around 2018, when Washington and Beijing engaged in a trade war.

And Brookings Institution senior fellow Robin Brooks pointed to signs this year of significant transshipments of Chinese goods.

He noted in a June report that Chinese exports to certain Southeast Asian countries started surging “anomalously” in early 2025 as Trump threatened widespread levies.

While it is unclear if all these products end up in the United States, Brooks cast doubt on the likelihood that domestic demand in countries like Thailand and Vietnam rocketed right when Trump imposed duties.

“One purpose of the transshipment provisions is to force the development of supply chains that exclude Chinese inputs,” said William Reinsch, senior adviser at the Center for Strategic and International Studies.

“The other purpose is to push back on Chinese overcapacity and force them to eat their own surpluses,” he added.

But Washington’s success in the latter goal depends on its ability to get other countries on board.

“The transshipment penalties are designed to encourage that,” Reinsch said.

Lipsky added: “The strategy that worked in the first Trump term, to try to offshore some Chinese manufacturing to other countries like Vietnam and Mexico, is going to be a much more difficult strategy to execute now.”

– China response? –

Lipsky noted that Beijing could see the transshipment clause as one targeting China on trade, “because it is.”

“The question is, how China takes that in the broader context of what had been a thawing relationship between the US and China over the past two months,” he added.

While both countries temporarily lowered triple-digit tariffs on each other’s exports, that truce expires August 12.

The countries are in talks to potentially extend the de-escalation, although the final decision lies with Trump.

It will be tough to draw a line defining product origins, analysts say.

Customs fraud has been illegal for some time, but it remains unclear how Washington will view materials from China or elsewhere that have been significantly transformed.

The burden lies with customs authorities to identify transshipment and assess the increased duties.

“That will be difficult, particularly in countries that have close relations with China and no particular incentive to help US Customs and Border Protection,” Reinsch added.

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