The Trump administration has proposed new tariffs on imports from Canada, Mexico, the European Union and dozens of other economies after an investigation found shortcomings in how trading partners address goods produced with forced labor.
The proposal, announced by the Office of the U.S. Trade Representative (USTR), would impose a 10% tariff on imports from several major U.S. trading partners, including Canada, Mexico and the European Union, while a higher 12.5% duty would apply to most of the other countries examined in the investigation, Politico reported.
The recommendations stem from a Section 301 investigation launched earlier this year into 60 economies over their efforts to prohibit or prevent imports made with forced labor. U.S. Trade Representative Jamieson Greer said in a statement that the failure of major trading partners to adequately address forced labor imports has created an uneven playing field for American workers.
"The failure of our most important trading partners to address the importation of goods made with forced labor is unacceptable," Greer said. "This creates a dynamic where American workers are forced to compete globally on an unlevel playing field."
According to findings released by the USTR, Canada, Ecuador, the European Union, Indonesia, Mexico and Pakistan were identified as economies that have laws restricting imports made with forced labor but have not effectively enforced those measures. The agency recommended a 10% tariff rate for those economies.
The same tariff level was also proposed for nine countries that have committed through trade agreements with the United States to address forced labor concerns, as well as the United Kingdom, which the USTR said has implemented only a partial system aimed at preventing forced labor in supply chains.
The remaining 44 economies covered by the investigation would face a proposed tariff rate of 12.5%, including major trading partners such as Japan and South Korea. Other countries included in the investigation were China, India, Brazil, Switzerland and Thailand.
The announcement comes amid a broader effort by the administration to reshape U.S. trade policy following a Supreme Court decision earlier this year that invalidated several tariffs imposed under emergency economic authorities. The temporary 10% global tariff currently in place was intended as a bridge while the administration pursued alternative trade actions through Section 301 investigations.
The proposed duties arrive at a sensitive moment in U.S. trade relations with several allies and economic partners.
For the European Union, the recommendations come as EU officials prepare for a vote later this month on reducing tariffs on certain U.S. goods under an agreement reached with Washington last year.
Canada and Mexico are also engaged in discussions surrounding the mandatory review of the United States-Mexico-Canada Agreement (USMCA), the regional trade pact that replaced NAFTA during President Donald Trump's first term. Both countries adopted labor provisions aimed at eliminating forced labor under the original USMCA negotiations.
Reaction from U.S. trading partners began emerging shortly after the report's release.
Mexico's Economy Ministry said exports that comply with USMCA rules of origin would be exempt from the proposed forced labor tariffs, with approximately 85% of Mexican exports to the United States expected to qualify under those provisions, Reuters reported.
In Europe, Bernd Lange, chairman of the European Parliament's Committee on International Trade, criticized the proposal and argued that the European Union has already enacted stringent legislation aimed at removing forced labor from supply chains. Additional tariffs beyond existing trade arrangements would be unacceptable to the bloc, Lange said, according to the news agency.
The proposed tariff rates are not final. The USTR has requested written comments through July 6 and plans to hold public hearings on July 7 before determining whether to move forward with the recommendations.
If implemented, the duties would represent one of the administration's most significant trade actions since the Supreme Court ruling reshaped its tariff strategy earlier this year, according to The Associated Press.
