Trump Tariffs "Rebranded": What's Different This Time?

The 122 tariffs enacted by the Trump administration as a transitional measure will expire on July 24. However, tariff policy remains a key pillar of Trump’s core economic agenda. Judging from the policy actions already taken by the Trump administration, the U.S. is rebuilding country-specific tariffs and expanding sectoral tariffs through Section 301, Section 338, and Section 232 investigations, respectively.

1. How will Trump’s new tariffs be implemented after Section 122 expires?

Section 301 investigations primarily target the trade policies and practices of specific countries. The latest country case is Brazil. The USTR has completed its investigation and decided to impose a 25% tariff on Brazilian goods starting July 22, while granting certain product exemptions. A broader range of Section 301 actions is also underway. The USTR has launched structural overcapacity investigations against 16 economies and forced labor investigations against 60 economies. Among them, the forced labor investigations have proposed tariff increases of 10% or 12.5%, though final measures have not yet been announced. The structural overcapacity investigations are still in progress.

Section 338 is emerging as a new tool for country-specific countermeasures. On July 20, Trump signed three presidential proclamations under Section 338 of the Tariff Act of 1930, imposing 50% tariffs on nearly $20 billion worth of Canadian goods due to Canada’s discriminatory treatment of U.S. products in the automotive, alcoholic beverages, and dairy sectors. The measure takes effect on August 19, covering products such as wine, hockey sticks, and cement, with no exemption based on USMCA rules of origin.

Section 232 investigations, based on whether imports threaten U.S. national security, mainly cover strategic industries such as steel, automobiles, chips, and pharmaceuticals. Building on existing steel and aluminum tariffs and implementing tariffs on autos and auto parts, the U.S. will launch 12 new Section 232 investigations in 2025. Currently, tariffs on copper, timber, medium and heavy vehicles, and certain advanced computing chips have already been enacted, and pharmaceutical tariffs have been announced but not yet implemented. Although investigations on critical minerals and commercial aircraft have concluded, no immediate tariffs have been imposed, and investigations into drones, polysilicon, wind turbines, industrial robots, and medical equipment have not yet published final measures.

Compared to IEEPA and Section 122 tariffs, which can be quickly implemented through presidential executive orders, Section 301 and 232 tariffs—though having solid legal bases—require investigation, consultation, and implementation procedures. For example, the more than 200 employees of the USTR must juggle trade negotiations, Section 301 investigations, and agreement enforcement. However, the Bureau of Industry and Security (BIS) of the Department of Commerce, responsible for Section 232, is even facing staff reductions. According to Bloomberg estimates, as of April 2026, the BIS will have 101 fewer employees than in 2024, a decrease of about 19%, but its scope of tasked work has already reached export controls and multiple industry tariff investigations.

Section 338 provides a faster supplementary pathway, as it does not require the initiation, public comment, and hearing procedures seen in Section 301. Once the president determines a country is discriminating against U.S. business and putting it at a disadvantage relative to third countries, a proclamation can be issued and, after 30 days, a tariff of up to 50% can be imposed on the relevant country’s goods. However, the applicability threshold of Section 338 is narrow and must target identifiable discriminatory treatment. The U.S. adoption of Section 338 against Canadian automobiles, dairy, and alcoholic beverages this time shows it is more suitable for addressing specific country and dispute cases.

Therefore, in the short term, Section 301 and 232 tariffs cannot seamlessly replace the soon-to-expire global 10% surtax, and Section 338 cannot function as a global substitute. The U.S. is more likely to use Section 301 to cover key trade partners, Section 232 for strategic industries, and Section 338 for rapid responses to individual countries’ discriminatory or retaliatory measures, before gradually expanding the new tariff system’s coverage based on further investigations.

2. Impact of the new tariff system on global economies and industries

Firstly, tariff rates will differ across economies, broadly continuing the rates from previous rounds.

The 301 forced labor investigations cover 60 economies, with proposed rates of 10% or 12.5%. Among them, 16 economies are also under structural overcapacity investigations, and countries such as China, Vietnam, Germany, and Brazil face additional country-specific investigations. The more investigations a country is included in, the higher the potential tariff risk, but these tariffs are not necessarily simply cumulative.

Trade agreements are an important factor constraining final tariff rates. Greer noted that the U.S. will adhere to comprehensive tariff ceilings agreed with the EU, Japan, and other economies. Under existing agreements, the UK’s potential tariff ceiling is 10%, the EU, Japan, and Korea are at 15%, India’s is 18%, and some Southeast Asian economies are 19% or 20%. For economies with agreements in force, Section 301 may provide grounds for new tariffs, but any additional tariffs are likely to be included within those existing ceilings, not stacked above them.

For economies that have not yet reached an agreement, have only applied temporary arrangements, or are still negotiating, tariff ceilings remain unclear, making policy uncertainty higher. China is simultaneously included in forced labor, structural overcapacity, and Phase 1 trade agreement compliance investigations, with no comprehensive U.S.-China tariff ceiling, leaving considerable room for future rate adjustments.

Section 338 adds extra risk for economies that impose discriminatory measures against the U.S. The U.S. has not yet published a candidate list for this, but in three Canadian Section 338 proclamations, it found Canada imposed tariffs and quotas solely on U.S. autos, restricted U.S. alcoholic beverages in procurement, distribution, and retail, and gave the EU more favorable treatment than the U.S. in cheese tariff quota allocation. All these were determined to place U.S. business at a disadvantage relative to third countries. The White House additionally noted that, over the past 18 months, only China and Canada have chosen to retaliate against U.S. tariffs rather than resolve issues through negotiation.

Secondly, industry-wide, the approach remains general tariff increases with targeted exemptions, consistent with Section 122 exemption scope. Exemptions focus mainly on fields where the U.S. is highly import-dependent and short-term substitution is difficult, such as energy, pharmaceuticals, fertilizers, critical minerals, some agricultural products, the civil aviation supply chain, PCs, semiconductor manufacturing equipment, and display modules, or products where tariff increases would rapidly raise production and living costs.

Section 232 tariffs and forced labor Section 301 tariffs are not cumulative. Currently, Section 232 tariffs apply to industries including steel and aluminum and their derivatives, copper semi-finished and high-copper-content products, passenger cars and light trucks and their components, medium and heavy vehicles and components, buses, timber and certain wood products, and certain advanced computing chips. These industries will not face an overlapping forced labor Section 301 tariff. Although investigations into key minerals and commercial aircraft under Section 232 are complete, tariffs have not yet been imposed, and whether these goods can be exempted from Section 301 depends on whether they are listed in the exemption schedule.

Future sectoral tariff burden will also depend on the progress of the Section 301 and 232 investigations. The scope of the structural overcapacity Section 301 investigation has not yet been published, but it is highly likely to follow the handling approach of the forced labor Section 301, using the same exemption list. Country-specific Section 301 investigations do not apply a unified exemption framework; specific scope depends on investigation conclusions and bilateral negotiation outcomes. Pharmaceutical Section 232 tariffs have been announced but are not yet in effect. Investigations into polysilicon, drones, wind turbines, industrial robots, and medical devices have not yet been concluded, and the affected sectors still face the risk of new Section 232 tariffs.

3. Limited impact of the new tariff system on China

If the forced labor Section 301 tariff is set at 12.5%, replacing the previous Section 122 rate of 10%, the overall weighted U.S. tariff on Chinese goods will rise from 21.9% to 23.1%, an increase of 1.2 percentage points.

The industries with the highest tariff rates are steel and other metal products, vehicles and auto parts, general and special machinery, pharmaceuticals and medical products, and textiles and apparel, at 45.1%, 39.9%, 34.0%, 31.1%, and 29.8% respectively. Although steel, automotive, and machinery already face high cumulative tariffs, their rate increases are just 0.4–0.8 percentage points.

The industries with the greatest marginal impact are textiles and apparel, agricultural products, watches and jewelry, plastics and rubber products, and wood furniture, with their rates rising by 1.9–2.5 percentage points.

Future U.S. tariffs on China will mainly depend on two aspects. First, the Section 301 structural overcapacity and Phase 1 trade agreement compliance investigations may produce new tariffs on China. Second, post-summit tariff reductions after meetings between U.S. and Chinese leaders may expand the range of Chinese goods eligible for tariff exemptions. Both sides have established a potential reciprocal tariff reduction framework covering at least $30 billion worth of goods each and clarified certain agricultural market access arrangements. Since the specific product lists have not been announced, which goods will be eligible for Most-Favored-Nation rates or lower rates is still to be determined by further negotiation.

Note: As of July 21, 2026, the U.S. Senate has officially submitted S.5025 “Russia Sanctions Act,” proposing to impose up to 100% additional tariffs on the top five economies in Russian crude oil and natural gas imports, and the five economies most involved in assisting the circumvention of oil sanctions, a significant reduction from the original 500%. The bill has now been referred to the Senate Banking Committee but has not yet come into effect.