White House signals broad 15% tariff under Section 122
Donald Trump is not backing down from his plan to introduce global tariffs even after losing in the Supreme Court. The day after the unfavorable ruling, he announced the immediate introduction of a 15% tariff on all imported goods, regardless of country of origin.
Following news of the Supreme Court defeat, Trump pledged to tighten trade policy and introduce a 10% global tariff on all imports, and the next day stated that he would raise it to 15%.
For some countries, the new tariff could be even higher than the rates previously applied to their exports to the United States that were struck down by the Supreme Court. However, some observers said they were surprised that Trump did not immediately name the 15% rate on Friday.
Section 122 of the U.S. Trade Act of 1974 allows the president to impose a temporary tariff or quantitative restrictions for up to 150 days without congressional approval to provide emergency protection for the trade balance and rapid macroeconomic stabilization.
Trade negotiator Daniel Mullaney, who served under both Trump and Obama, told the BBC that it was widely expected the president would resort to Section 122 if the Supreme Court ruled against the previously imposed tariffs.
“Most of us assumed he would use Section 122 and the maximum rate of 15%,” Mullaney told the BBC, adding that it remains unclear which countries the new tariffs will apply to and whether the 15% would be stacked on top of existing duties or replace them.
Do privileges still apply?
However, as recently as Friday, a White House representative stated that countries that had previously concluded trade agreements with the United States, including the United Kingdom, would be subject to the global tariff under Section 122 rather than the previously negotiated rates.
The UK government, however, has said it expects the “UK’s privileged trading position with the United States” to remain intact, noting that sectors such as steel, aluminum, pharmaceuticals, automobiles, and aerospace — which account for a large share of its trade with the U.S. — were not covered by earlier negotiations.
As we wrote, Supreme Court tariff ruling triggers $175 billion refund battle
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