US sets 10-12.5% tariffs on 60 partners, covering 99% of imports
The US administration has replaced expiring global tariffs with a new forced-labor-based framework covering 99% of imports, signaling a legally durable but economically damaging trade policy shift.
The US administration rolled out a fresh tariff framework on 60 trading partners, slapping 10% to 12.5% taxes on imports just hours before a temporary 10% global surcharge expired. The new policy relies on Section 301 powers focused on forced-labor enforcement rather than the Section 122 emergency authority previously struck down by the Supreme Court. When accounting for individual European Union member states, the duties cover more than 80 countries and impact over 99% of US imports.
For corporate supply chains and investors, the immediate takeaway is that the tariff regime is becoming legally entrenched. The White House has clearly learned from its courtroom defeats, abandoning the emergency rationale for an approach University of Michigan economist Justin Wolfers said is "somewhat likely to survive." He noted this is not because the underlying economics improved, but strictly because the administration chose "a process that courts are more likely to tolerate."
Despite the legal recalibration, the economic impact on businesses remains a heavy burden. Wolfers dismissed the framework as a "new wrapper, same rotten policy," warning that "these latest tariffs may pass muster with the courts, but will still fail our country." The structure of the duties offers almost no room for companies to optimize their sourcing. Countries deemed compliant with forced-labor rules face a 10% tax, while non-compliant nations face 12.5%.
Wolfers characterized that 2.5 percentage point differential as "not diplomacy, that's a rounding error." For executives managing global procurement, this narrow band renders the compliance incentive essentially meaningless. The broad-brush approach also risks long-term damage to allied trade relations. Wolfers argued that targeting wide trade alliances in this manner "destroys American leverage rather than creating it," adding, "what's going on here is so transparently bad faith. It might pass muster with the courts, but it won't with our trading partners."
