U.S. Announces 10% Tariff Hikes on Canadian Imports Following Global Forced Labour Investigation
The Trump administration has proposed new tariffs of 10 per cent and 12.5 per cent on imports from 60 economies after determining that they failed to curb trade in goods made with forced labour, a finding described by a senior EU lawmaker as “utterly absurd.”
The proposal from the U.S. Trade Representative’s office (USTR), issued late on Tuesday, comes from a Section 301 unfair trade practices investigation designed to help rebuild U.S. President Donald Trump’s emergency tariffs, which were struck down by a U.S. Supreme Court decision in February.
The USTR proposed 10 per cent additional duties on imports from Canada, Ecuador, the European Union, Indonesia, Mexico, Pakistan, Argentina, Bangladesh, Cambodia, El Salvador, Guatemala, Malaysia, Taiwan and Britain. The USTR said all had plans or partial schemes in place.
The trade agency said it would impose additional duties of 12.5 per cent on the remaining 45 countries that it investigated. These include China, India, Nigeria, Japan, South Korea, Australia and New Zealand.
“The failure of our most important trading partners to address the importation of goods made with forced labor is unacceptable,” U.S. Trade Representative Jamieson Greer said in a statement. “This creates a dynamic where American workers are forced to compete globally on an unlevel playing field.”
The USTR said it also was proposing a textile mechanism that would allow for a certain volume of apparel and textile imports to enter the U.S. at a reduced tariff rate, though the duties and volumes were not disclosed.
Europe says new tariffs are unjustified
The announcement comes ahead of the July 24 expiration of a 10 per cent temporary tariff imposed by the Trump administration on Feb. 20, the day the Supreme Court struck down Trump’s tariffs under the International Emergency Economic Powers Act.
The European Commission said the tariffs were unjustified and reiterated its commitment to the trade deal sealed with Washington last year. Bernd Lange, the chair of the European Parliament’s trade committee, which voted on Tuesday to accept that trade deal, said the new tariffs were expected, but said the findings were still “utterly absurd” given a 2024 EU law to ban imports of forced labour products.
“The impression is increasingly emerging that a tariff measure is sought first, and only then is a suitable legal justification found,” he said. However, he added that the key question would be whether the additional tariffs would exceed those agreed between both sides last July.
The United States’ largest trading partner, the European Union, agreed last July to accept U.S. tariffs of 15 per cent on a broad range of its exports. In its report, the USTR said the EU measures only came into force in December, 2027, and lacked certain key elements.
Taiwan said it was “hopeful and confident” that the final results would reflect agreements already reached, securing relatively preferential treatment. Beijing, facing 12.5-per-cent tariffs, said that it opposed all forms of unilateral tariffs and that there was no forced labour in China. India, confronted with the same rate, said it was engaged with Washington on the Section 301 proceedings, noting the proposed tariffs were not final.
On Monday, the USTR proposed a 25-per-cent duty on many Brazilian goods as a result of a Section 301 investigation into the country’s digital trade practices and preferential tariffs. The trade agency is also expected to soon unveil the findings of another major Section 301 probe into the buildup of excess industrial capacity in 16 trading partners, including China and the European Union.
In the forced labour findings, the USTR said it would exempt from the tariffs a number of products including energy, rare earths and some other metals, beef, coffee, certain fruits and vegetables, pharmaceuticals, organic chemicals and aircraft parts.
The USTR said it would accept public comments on the proposed tariffs and other remedies through July 6, with a public hearing scheduled for July 7.
This article was first reported by The Globe and Mail
