The United States replaces its expiring stopgap duties with sweeping Section 301 tariffs of 10 to 12.5 percent on 60 trading partners, citing their failure to ban goods made with forced labor
WASHINGTON, July 24, 2026 | Peacock Tariff Consulting, US Trade Desk
New American tariffs of 10 to 12.5 percent on imports from 60 trading partners took effect at 12:01 a.m. Eastern time on Friday, capping one of the most consequential weeks for United States trade policy since the current administration returned to office. The action, announced Thursday by United States Trade Representative Jamieson Greer at President Trump’s direction, is the final step in a set of Section 301 investigations into what Washington describes as the failure of its largest trading partners to prohibit and enforce bans on the importation of goods produced with forced labor.
The scale of the measure is difficult to overstate. According to a fact sheet published by the Office of the United States Trade Representative, the 60 economies covered by the action account for 99.4 percent of all United States imports. In practical terms, nearly every container that arrives at an American port from Friday onward will be assessed against a new tariff schedule, subject to a lengthy list of product exemptions spelled out in a Federal Register notice released alongside the announcement.
The timing was no accident. The new duties land on precisely the day that the administration’s temporary Section 122 tariffs, a stopgap global surcharge of 10 to 15 percent imposed in February, reach their statutory 150-day limit and expire. Congress declined to extend them. The White House, determined not to let its tariff wall lapse even for a day, has in effect swapped one legal foundation for another without interrupting the flow of duties into the Treasury.
A Race Against the Clock
To understand Friday’s action, it helps to rewind to February. On February 20, 2026, the Supreme Court ruled in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act, the 1977 statute the administration had used to erect its worldwide reciprocal tariff program, does not authorize the president to impose tariffs at all. The 6 to 3 decision, written by Chief Justice John Roberts, held that the power to tax imports belongs to Congress, and it invalidated the fentanyl-related tariffs on Canada, Mexico, and China along with the broader country-by-country reciprocal regime.
The administration pivoted within days. Invoking Section 122 of the Trade Act of 1974, which permits temporary import surcharges to address fundamental balance-of-payments problems, the president imposed a 10 percent global tariff effective February 24 and quickly signaled an increase toward the 15 percent statutory ceiling. But Section 122 comes with a hard limit: 150 days, unless Congress votes to extend. Lawmakers did not, and the clock ran out on Friday, July 24.
Ambassador Greer told the Senate Finance Committee on Wednesday that the expiration of the stopgap would change the government’s legal tools but not its direction. The national emergency that justified the original tariffs still exists, he said in written testimony, and so the policy remains the same. The specific authorities the administration is using have changed, he added, but the trade strategy has not. The Korea Herald, citing the Yonhap news agency, reported that Greer confirmed to senators the final forced labor action would be released as soon as Thursday, which is exactly what happened.
The Washington Times described the maneuver as backfilling the blanket tariffs Congress let expire, while NBC News noted that the administration framed the new duties around a single unifying rationale, forced labor enforcement, rather than the trade-deficit arithmetic that underpinned the struck-down reciprocal program. That distinction matters legally. Section 301 of the Trade Act of 1974 is a well-tested statute that authorizes the Trade Representative to respond to foreign acts, policies, and practices that are unreasonable or discriminatory and that burden or restrict United States commerce.
How the New Rates Break Down
The structure of the new tariff schedule rewards countries that have moved toward Washington’s position and penalizes those that have not. USTR set a 10 percent rate for economies that have imposed a forced labor import prohibition, committed to one through an Agreement on Reciprocal Trade, or put in place a partial regime that blocks at least some forced labor goods. That list includes Argentina, Bangladesh, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Pakistan, Sri Lanka, Trinidad and Tobago, and the United Kingdom.
A second tier applies to certain products of the European Union, Taiwan, Japan, Korea, and Switzerland, which face duties of 10 percent or 12.5 percent net of their Most-Favored-Nation rate. Customs advisory firm PCB Global Trade explains the mechanics in plain terms: the United States is implementing a 10 percent flat rate on goods from the European Union and Taiwan and a 12.5 percent rate on goods from Japan, South Korea, and Switzerland, calculated as a combination of MFN duties and the new Section 301 tariffs. Where a product’s existing MFN rate already exceeds the target level, no additional duty applies.
Everyone else pays the full freight. USTR determined that 12.5 percent is the appropriate rate for all other investigated economies, the ones the agency concluded have neither adopted nor meaningfully enforced any forced labor import prohibition. The two-tier design gives trading partners a standing incentive to legislate: pass and enforce an import ban, and a country can argue its way from the 12.5 percent tier into the 10 percent tier.
What Is Exempt
The exemption architecture is nearly as important as the rates themselves. According to the USTR fact sheet, the tariffs do not apply to informational materials, donations, and accompanied baggage, nor to any articles already subject to Section 232 national security tariffs, a carve-out that prevents stacking on steel, aluminum, copper, and other 232-covered goods. Beyond those categories, the Trade Representative exempted five classes of products: raw materials whose taxation could choke off domestic supply, products whose taxation could cause economy-wide disruptions, goods that cannot be grown or produced in sufficient quantity at reasonable prices in the United States or sourced elsewhere, products whose exemption would encourage specific economies to follow through on forced labor commitments, and articles for which tariffs would not meaningfully advance the goal of the investigations.
NBC News reported that oil and gas and fertilizer are among the exempted products, and that goods qualifying for duty-free treatment under the United States-Mexico-Canada Agreement are also spared, a significant relief valve for North American supply chains. The named-country exemption list is notable in its own right: certain products of Argentina, Bangladesh, Cambodia, Ecuador, El Salvador, the European Union, Guatemala, Indonesia, Jordan, Malaysia, Switzerland, Taiwan, and the United Kingdom escape the duties as an inducement for those governments to finish enacting or enforcing their import bans.
The full list of excluded tariff lines runs through the pre-publication Federal Register notice, and customs brokers spent Thursday evening combing through it. For importers, the difference between a covered and an excluded HTS subheading is now worth 10 to 12.5 points of landed cost.
Sixty Investigations in Four Months
The procedural sprint behind Friday’s action was remarkable by the standards of trade litigation. At the president’s specific direction, USTR initiated 60 parallel Section 301 investigations on March 12, 2026, one for each major trading partner, all focused on the same question: whether the failure to impose and effectively enforce a prohibition on importing forced labor goods is an unreasonable practice that burdens American commerce.
The agency convened public hearings on April 28 and 29, held consultations with more than 45 of the investigated governments, and on June 2 determined that the practices of all 60 economies were actionable. A proposed remedy followed, drawing more than 1,600 written comments, and a second round of hearings ran from July 7 to July 9, with over 100 witnesses testifying. Across the entire proceeding, USTR says it received more than 2,100 public comments. Four and a half months from initiation to final action is, by any measure, one of the fastest large-scale Section 301 exercises ever run.
The speed invited criticism that the outcome was predetermined, a replacement revenue stream dressed in human rights clothing. The administration rejects that characterization, pointing to the graduated rate structure and the exemptions as evidence that the process responded to the record. Skeptics point to the timing: the final action landed one day before the Section 122 expiry, and the president’s own direction set the rates.
The Administration’s Case
Ambassador Greer framed the action as the culmination of a century of American policy. President Trump recognizes that decades of moral suasion have not eradicated forced labor from global supply chains, Greer said in the USTR announcement. The United States has had a forced labor import ban for nearly a century and rigorously enforces it, he said, adding that it is well past time for trading partners to do the same.
Today’s action will begin to correct what is both a human rights abuse and a distortive trade practice to improve the welfare of workers everywhere, Greer continued, saying he was encouraged by the trading partners who have moved quickly to adopt forced labor import prohibitions and looked forward to ensuring their effective enforcement.
The White House points to a genuine enforcement record beneath the rhetoric. The United States has prohibited imports made with forced labor since the Tariff Act era nearly a century ago, and Customs and Border Protection actively polices the ban. In June alone, CBP issued new Withhold Release Orders against copper products manufactured by a producer in Serbia and against apparel manufactured in Jordan, directing ports to detain those shipments. The agency also published new importer guidance last month explaining how its various forced labor authorities interact. The administration also notes that the USMCA, negotiated in the president’s first term, extracted commitments from Canada and Mexico to adopt their own import prohibitions, and that ten partners have now agreed to enact bans through Agreements on Reciprocal Trade.
Pushback From Trading Partners
Trading partners have been considerably less enthusiastic. South Korea, which lands in the 12.5 percent tier, formally urged the United States to reconsider, calling the proposed tariff unwarranted and disproportionate in comments submitted to USTR, according to Yonhap. Seoul’s frustration is compounded by a separate set of Section 301 investigations, still pending, into alleged structural excess capacity involving Korea and 15 other economies.
The European Union finds itself in an awkward middle position. Brussels negotiated a 15 percent tariff ceiling with Washington in the Turnberry Agreement last summer, and Euronews reported this week that the European Commission has said it will not retaliate against the new duties so long as they remain within that cap, which they do. But the forced labor tariffs arrive amid an escalating transatlantic quarrel over the EU’s nearly one billion dollar antitrust fine against Google, announced the day before the tariffs took effect, which Ambassador Greer said creates massive uncertainty for United States exporters.
Other governments are weighing their options between accommodation and complaint. The graduated structure gives most of them a cheaper path than retaliation: pass an import ban, enforce it, and petition for the lower tier or for product exemptions. That, of course, is exactly the behavioral lever Washington designed.
The bilateral deal track is moving in parallel. USTR announced this month that Ambassador Greer signed the United States-Jordan Agreement on Reciprocal Trade, the latest in the series of bilateral accords the administration has used to lock in tariff terms and, increasingly, forced labor commitments. Jordan appears on both the 10 percent tier and the named-country exemption list, a preview of how compliance gets rewarded. Meanwhile the administration’s willingness to escalate against holdouts was on display earlier the same week, when the president imposed separate Section 338 tariffs reaching 50 percent on many goods from Canada in a distinct dispute, demonstrating that the post-February toolkit extends well beyond Section 301.
Talks with Mexico continue on a separate track as well, with USTR convening a third bilateral negotiating round in Mexico City related to the joint review of the USMCA. Because USMCA-qualifying goods escape the new forced labor duties entirely, the health of that agreement now carries even higher stakes for North American manufacturers than it did a month ago.
The Economic Stakes
For American consumers and businesses, the practical question is what changes relative to the tariffs that expired the same day. The answer is nuanced. The Section 122 surcharge ran between 10 and 15 percent across virtually all imports. The new Section 301 regime spans 10 to 12.5 percent, with more exemptions. For some products from some countries, landed costs will actually fall slightly; for previously exempt or lightly taxed lines that now fall inside the Section 301 net, costs rise.
Because the covered economies represent 99.4 percent of United States imports, the aggregate revenue implications are enormous. United States goods imports have been running above three trillion dollars annually, and even after exemptions a broad 10 to 12.5 percent levy plausibly generates well over two hundred billion dollars a year in duties, sustaining the tariff revenue stream the administration has increasingly treated as a fiscal pillar. Economists remain divided on incidence, with most studies of the 2018 to 2025 tariff waves finding that American importers and consumers bore the majority of the cost through higher prices, while the administration argues the burden falls on foreign producers through compressed margins and currency effects.
The forced labor framing also has a supply chain dimension that pure revenue tariffs lack. Companies whose sourcing touches regions and sectors with documented forced labor risk, from certain mineral supply chains to apparel, now face both the tariff and the underlying enforcement risk of detentions under Withhold Release Orders. Compliance officers who once treated forced labor due diligence as a reputational matter now confront it as a line item.
For retailers and consumer brands, the timing collides with peak season. Orders for holiday inventory are largely booked, contracts were priced against the old surcharge, and a new duty structure landing in late July leaves little room to re-source before goods ship. A recurring argument in the record, which drew more than 1,600 written comments on the proposed remedy alone, is that a tariff is a blunt instrument for a labor rights objective, and that targeted detentions and due diligence requirements reach forced labor more precisely than an across-the-board levy that falls equally on compliant and non-compliant producers.
What Importers Should Do Now
For importers, the immediate work is tariff engineering in the narrow, lawful sense: mapping every imported HTS subheading against the Federal Register exclusion list, confirming country-of-origin determinations, and recalculating landed costs under the new two-tier structure. Goods qualifying under USMCA rules of origin escape the duties entirely, which will push more North American supply chains to complete the certification work many deferred when USMCA qualification was merely advantageous rather than essential.
The Section 232 carve-out cuts both ways. Articles already subject to steel, aluminum, and copper tariffs avoid the new duties, but those 232 rates are generally higher, so the exemption is cold comfort. Importers of EU, Japanese, Korean, Swiss, and Taiwanese goods need to run the net-of-MFN arithmetic line by line, since products with high existing MFN rates may owe little or nothing in additional duty.
Exporters, meanwhile, should watch the diplomatic channel. The exemption categories built into the action, particularly the named-country product exemptions designed to encourage adoption of import bans, signal that USTR expects a rolling series of adjustments as partners legislate. Companies with concentrated exposure to a single 12.5 percent country have a concrete interest in that country moving into the 10 percent tier, and trade associations are already organizing to press foreign capitals to act.
The Road Ahead
Legal challenges are likely but face a steeper climb than the IEEPA cases did. Section 301 has survived decades of litigation, including the China tariff challenges, and the statute explicitly contemplates presidential direction of responsive action. The novel question is whether 60 simultaneous investigations aimed at a single global outcome stretch the statute’s country-specific logic. Importers’ counsel were parsing the Federal Register notice within hours of its release.
The operational burden now shifts to Customs and Border Protection, which must administer a duty regime with two rate tiers, a net-of-MFN calculation for five major economies, thousands of excluded tariff lines, and country-specific exemption lists, all layered atop the existing patchwork of Section 232 metals tariffs, Section 338 measures, antidumping and countervailing duties, and preferential trade programs. Entry filing errors, misclassification disputes, and post-summary corrections tend to spike after transitions like this one, and brokers are warning clients to expect slower processing and more requests for information at the ports in the coming weeks.
Congress could also reassert itself, as it did by declining to extend Section 122, but tariff revenue has become entangled with fiscal math on Capitol Hill, and few observers expect a veto-proof coalition against the new duties. The more probable path of change runs through negotiation: more Agreements on Reciprocal Trade with forced labor chapters, more partial regimes upgraded to full ones, and a slow migration of countries from the higher tier to the lower.
What is already clear is that the administration has completed a legal metamorphosis eighteen months in the making. The tariff wall that began under an emergency powers statute, survived a Supreme Court defeat, and sheltered for 150 days under a balance-of-payments provision now rests on the oldest and most durable workhorse in the modern American trade arsenal. For the 60 economies on the receiving end, and for the importers writing the checks, Section 301 is the new baseline, and Friday was day one.