Trump's Trade Tariff Updates
Update: 2/5/2025
To retaliate against the 10% U.S. tariff on all Chinese goods, China introduced the following additional duties on U.S. exports:
- 15 percent tariffs on coal and liquefied natural gas (LNG), covering goods under eight Harmonized Tariff Schedule (HTS) codes
- 10 percent tariffs on crude oil, agricultural machinery and large-engine vehicles, affecting commodities under 72 HTS codes
These tariffs are scheduled to take effect on February 10, 2025.
The US Postal Service (USPS) will not be implementing the ban on all inbound packages from China and Hong Kong announced yesterday. In the initial notice, USPS said that it would no longer accept parcels from China and Hong Kong after the US imposed an additional 10% tariff on Chinese goods and ended the de minimis exception that allowed small value parcels to enter the country without paying tax. According to USPS officials, it will work with CBP to implement a collection process for the new China tariffs to avoid delivery disruptions.
Update: 2/4/2025
Trump’s Canada and Mexico Tariffs Postponed
The implementation date of the proposed tariffs against Canada and Mexico has been postponed by one month, moving the effective date from February 4, 2025 to March 4, 2025.
Both countries have offered concessions that appear to have contributed to the postponements:
- Trudeau, the Prime Minister of Canada has committed to appointing a fentanyl czar and implementing a border plan.
- Mexico agreed to add a significant number of national guards to their border, to stymie the info flow of drugs and illegal immigration into the U.S.
As of now, the 10% tariff on China and Hong Kong imports remains unchanged. Please refer to the Federal Register Notice and the instructions released to the trade. In addition, the China de minimis loophole remains closed at this time.
Update: 2/3/2025
President Trump announced today he has agreed to immediately pause tariffs proposed against Mexico for one month after President Sheinbaum agreed to send 10,000 Mexican troops to the border to help combat drug trafficking.
Update: 2/1/2025
What We Know So Far
President Trump has invoked the International Emergency Economic Powers Act to issue three executive orders imposing new ad valorem tariffs:
- 25% on products from Mexico
- 25% on products from Canada (except energy products, which are at 10%)
- 10% on products from China
These additional tariffs take effect on Tuesday, February 4, 2025, on top of existing duties (e.g., Section 301, Section 232, antidumping/countervailing duties).
While the Canadian-focused order has been published, the orders for Mexico and China are still pending. However, they are expected to follow the same framework, apart from the reduced duties for Canadian energy imports.
Key Takeaways
1. Effective Data & Exceptions
- The tariffs take effect Tuesday, 2/4, but goods already on the water before 2/1 are exempt.
2. Unclear Scope
- The Department of Homeland Security (DHS) will define covered goods via a Federal Register notice, but its publication before the tariff deadline is uncertain.
3. Open Questions
- Will tariffs apply to goods originating in Mexico/Canada under USMCA?
- Will tariffs cover Chinese goods not already subject to Section 301?
4. Canadian Energy Definition
- Includes crude oil, natural gas, refined petroleum, uranium, coal, biofuels, and critical minerals under 30 U.S.C. 1606 (a)(3).
5. No Exclusions Announced
- No product exclusions or exclusion process has been provided.
6. Duty Drawback Prohibited
- The new tariffs cannot be recovered under duty drawback programs (19 CFR Parts 190, 191).
7. De Minimis Eliminated
- Duty-free treatment under Section 321 (for low-value shipments) is removed for goods from Canada, Mexico, and China.
8. Chapter 98 Uncertainty
- Past duty programs allowed exemptions under Chapter 98 (temporary imports, agriculture, etc.). It’s unclear if this applies here.
9. Potential Retaliation
- Tariffs could increase if Mexico, Canada, or China retaliate.
- Canada has announced retaliation:
- 25% tariffs on C$30 billion in U.S. goods (Feb 4)
- More tariffs on C$125 billion in three weeks (Feb 21)
10. Possible Reversal
- The Secretary of Homeland Security can recommend tariff removal, but no clear criteria for lifting them have been set.
What’s Next?
More updates are expected by 2/3 or 2/4. If you’d like to discuss further, please let us know.
Update: 1/31/2025
Karoline Leavitt, White House Press Secretary, has reported that 25% tariffs on Canada, Mexico, and 10% on China will be enacted on February 1, 2025. It is unclear at this time whether specific products will be exempt.
Update: 1/26/2025
The U.S. and Colombia have reached an agreement to resolve a trade and immigration dispute, ensuring stability for their trade relationship:
- Colombia agreed to accept deported migrants, including those transported on U.S. military aircraft, avoiding threatened U.S. tariffs and sanctions.
- President Trump levied a 25% tariff that would ramp to 50%. President Petro responded with a 50% tariff on US goods a short while later.
- Proposed U.S. tariffs of up to 50% on Colombian imports and additional sanctions, including travel bans on Colombian officials, have been suspended following the agreement.
- Similar challenges have arisen with other countries regarding deportation policies, including Mexico and Brazil, highlighting broader implications for trade and immigration in the region.
Update: 1/22/2025
Tariffs Hit Snooze, For Now…
President Trump has delayed imposing new tariffs and put a pause on new rules or regulations until they’re reviewed by his appointees. Here’s a quick rundown of what’s happening:
- A top-to-bottom review of trade policies is underway, with agency heads reporting back by April 1.
- Mexico and Canada could face 25% tariffs as early as February 1, depending on outcomes.
- Potential actions include new tariffs, additional 301 tariffs, changes to section 321 de minimis, and updates to steel and aluminum tariffs.
- NPRMs (like those affecting section 321 entries) are postponed for 60 days for further review.
- Potential 10% tariff on goods from China, also set to begin on February 1.
The full White House memo can be viewed here.
Customs and Border Protection (CBP) emphasized their ongoing commitment to security, safety, and facilitating legitimate trade during a recent call with industry leaders.
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