President Donald Trump has imposed new tariffs of 10% to 12.5% on goods from 60 countries, effective July 24, 2026. The move replaces a prior 10% global duty that expired at midnight, with the administration citing forced labor concerns to justify the levies under Section 301 of the Trade Act of 1974.
The new trade barriers affect trading partners accounting for 99% of U.S. imports, including China, the United Kingdom, Mexico, Canada, Australia, and the 27 member states of the European Union. According to the office of the CNN, the tariffs were enacted to address what the administration characterizes as a persistent failure by these nations to adequately prohibit goods produced through forced labor.
Legal Shift from Emergency Powers to Section 301
The current policy marks a strategic pivot for the Trump administration following a series of courtroom setbacks. In February, the U.S. Supreme Court ruled 6-3 that the president lacked the constitutional authority to impose tariffs during peacetime under the International Emergency Economic Powers Act. That ruling dismantled the broader “Liberation Day” tariff regime introduced in April 2025.
To maintain its trade agenda, the administration has pivoted to Section 301 of the Trade Act of 1974. Unlike the emergency powers used previously, Section 301 allows for duties against nations found to engage in unjustifiable, unreasonable, or discriminatory
practices. U.S. Trade Representative Jamieson Greer defended the transition during a congressional hearing on Thursday, stating that the administration’s goals remain consistent.
Alan Wolff, a senior fellow at the Peterson Institute for International Economics and former deputy director-general of the World Trade Organization, wrote that the latest tariffs again raise the question of whether the president has the legal authority to determine and implement US tariff policy, an authority the constitution vests in Congress.
International Reaction and Economic Impact
Trading partners have largely rejected the justification for the new levies. European Union foreign policy chief Kaja Kallas characterized the announcement as a negative surprise,
while Australian Trade Minister Don Farrell described the 12.5% tariff on his country’s goods as completely unjustified,
according to CNN. Canada, a significant U.S. partner, similarly pushed back against the forced labor allegations.
Matthew Holmes, executive vice-president of the Canadian Chamber of Commerce, argued that the timing of the policy was somewhat suspect,
noting that the administration chose to initiate these measures precisely as the previous round of sunsetting tariffs expired. Despite the broad reach of the new duties, officials indicated that certain goods—including specific oil and gas products and items that cannot be sourced domestically—have been granted exemptions to prevent supply chain disruptions.
Future Trade Escalations and Investigations
The current 10% to 12.5% rates may not be the ceiling for U.S. trade policy. The administration is currently conducting separate investigations into alleged global manufacturing overcapacity, which could provide the legal basis for further increases. Trade experts have noted that while the current measures are intended to provide continuity, the administration is exploring aggressive new avenues to protect domestic manufacturing.
As reported by cryptobriefing.com, some sector-specific proposals suggest even steeper duties, including a potential 100% tariff on semiconductors that could significantly increase costs for technology and infrastructure firms. While the current 10% to 12.5% tariffs largely preserve the status quo for importers, the administration has signaled that it will continue to leverage its remaining legal tools to pressure foreign trading partners.
Administration officials stated that they are prepared to keep higher levies in place, as they are not convinced affected countries would eliminate the practice of forced labor anytime soon.
With the midterm elections approaching in November, the political sustainability of these measures remains uncertain.
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