US Tariffs Whats happening and what does it mean

Blog

U.S. tariffs: what’s happening, and what does it mean?

  • US Tariffs Whats happening and what does it mean
4 minute read

On Wednesday April 2nd, President Trump announced a broad expansion of tariffs to apply to 185 countries and territories. Prior to this, new tariffs were announced to apply to China, Canada and Mexico, as well as sector-specific tariffs on aluminum, steel and automobiles. In this explainer, we’ll cover what has changed in U.S. trade policy and tariffs during 2025, how and when those changes are being applied, what’s covered, and what it means for businesses.

What are the goals of the changes in trade policy?

Tariffs on Mexico and Canada were introduced with the aim of pressuring the United States’ neighbors to do more to tackle alleged fentanyl smuggling and illegal immigration, as well as to protect domestic industry. The stated aim of the reciprocal tariffs according to The Office of the United States Trade Representative is “to balance bilateral trade deficits between the U.S. and each of our trading partners.”

What it means for businesses

The tariffs have been extensively re-negotiated, 'reciprocal' rates have changed, and deadlines have been extended to allow continued discussions. That uncertainty has left supply chains in a quandary: how to adapt to the unknown? And this unknown is not a far-off future change that cannot be forecasted, but a relatively short term and very impactful unknown that leaves supply chain leaders asking: how much will it cost to make, move and sell our products in a few months, or a few weeks from now? Which nations and suppliers are is best placed to serve our needs in a new world of tariff-affected trade?

The common fears for supply chains are  of increased cost of goods sold (COGS), reduced margins, already-committed orders and inventory becoming unprofitable, and the concern that price increases will drive consumer behavior change and reduced demand.

Manufacturers and suppliers are likely to push increased costs on to end-users, and retail brands are likely to also increase prices to protect margins.

How can you react?

Disruption at this scale and speed is challenging in the best of circumstances, but many supply chain organizations are still struggling with slow decision-making, manual scenario planning and limited insight into their trading partners.

The implications of the changing trade policies are potentially enormous and require supply chain leaders to be able to collaborate effectively across functions and with partners—something that’s not possible to do when data is siloed, slow to update and slow to communicate.

To create a playbook for handling this type of uncertainty and disruption at speed and scale requires supply chain managers to be able to see in real time what's happening in their network. They need to be able to see what's happening not just in their own business, but in their trading partners.

Connecting these businesses in a digital supply chain network like the Blue Yonder Network does more than enabling better scenario planning and more agile responses to major shifts like tariff impositions. It also helps supply chains react rapidly to any kind of disruption, helping leaders see issues as they develop rather than once their downstream effects are felt, and allowing them to make the kinds of on-the-fly adaptations and changes that true scenario planning calls for.

 

Timeline

July 31: President Trump signs an executive order formalizing many of the deals announced prior, as well as confirming new reciprocal rates on countries which have not made a deal with the U.S. The order specifies rates for more than 60 countries, and delays the implementation of these rates from August 1 to August 7.

July 27: The European Union and U.S. negotiate a trade deal which sees 15% tariffs on EU exports to the U.S., as well as an opening up of EU markets to certain American products, with no tariffs.

July 22: Japan and the U.S. agree terms on a trade deal setting 15% tariffs on Japanese exports, alongside a range of investment and purchases by Japan.

July 15: Indonesia and the U.S. come to terms, with the U.S. set to levy 19% tariffs on Indonesian exports, lower than the 32% figure previously slated to come into effect August 1.

July 8: President Trump makes remarks at a cabinet meeting signalling intent to put 50% tariffs on copper imports, and 'very high rate, like 200%' levies on pharmaceuticals.

July 7: President Trump announces new tariff rates on 14 countries, and announces that reciprocal rates first revealed back in April will come back into effect for all countries without a trade deal on August 1, as well as adjusting some of the initially-promised reciprocal rates.

us-tariffs-whats-happening-and-what-does-it-mean-body-02

July 4: The "One Big Beautiful Bill Act" is signed into law, which includes a stipulation that the 'de minimis' exemption will be removed entirely as of July 1 2027.

July 2: The United States and Vietnam reach a trade deal which sees 20% tariffs on Vietnamese exports to the US, and no tariffs on US exports to Vietnam.

June 11: A 'trade framework' is reached between the United States and China to ease technology restrictions and open up trade of rare-earth metals.

May 30: President Trump announces that aluminum and steel tariffs are set to increase from 25% to 50% as of Wednesday June 4.

May 29: A federal appeals court grants an administrative stay on the injunctions while the case is appealed—meaning tariffs can continue to be collected until the appeals court makes a ruling. The plaintiffs in the original case have until June 5 to file a response.

May 28: The Court of International Trade issues an injunction halting the executive orders by which President Trump enacted many of the new tariffs, particularly those on Canada, Mexico, China, the 10% global tariff, and the reciprocal tariffs.

May 12: U.S. and China announce deal to cut tariffs for the next 90 days. The U.S. cut back extra tariffs on Chinese imports from 145% to 30%, and Chinese tariffs on U.S. imports reduced to 10% from 125%, until a deal is reached or August 10.

April 9: Hours after reciprocal tariffs began, President Trump authorized a 10% tariff rate across the board, with the exception of China—essentially pausing the reciprocal tariffs for 90 days as negotiations with many countries continued. However, China is now the target of 125% tariffs.

April 5: 10% baseline tariffs enacted.

April 3: Automotive tariffs come into effect. 

April 2: President Trump announces ‘reciprocal’ tariffs on 185 nations and territories due to come into effect on April 9, alongside a baseline tariff of 10% on all imports coming into effect on April 5, with many countries being subject to much higher percentages. The tariffs are described as reciprocal, though they are not correlated to tariffs that each country levies on US imports. Instead, a White House official quoted by the BBC explains that they are based on a calculation of the trade deficit the US has with each nation/territory, divided by imports.

In a separate executive order, President Trump abolished the ‘de minimis’ exemption for goods from China and Hong Kong. This exemption, widely used by businesses like Temu, Shein and others, previously meant that imports under the value of $800 would not incur duties.

March 26: President Trump announces 25% tariffs on automotive imports, due to start collection on April 3 for fully imported cars and expanding over the following weeks to include more imported car parts, up until May 3.

March 12: Tariffs on steel and aluminum imports go into effect.

March 6: Tariffs are delayed for goods compliant with the United States—Mexico—Canada Agreement (USMCA), initially for a month and now indefinitely.

March 4: Tariffs on Mexican and Canadian imports come into effect. Tariffs on Chinese imports are increased from 10% to 20%.

February 10: President Trump modifies steel and aluminum tariffs to remove exceptions, raise the rate from 10% to 25%, and add more steel and aluminum products to be covered by the tariffs. 

February 4: The 10% tariff on Chinese imports comes into effect. 

February 3: One-month delays are negotiated for these tariffs in the cases of Mexico and Canada.

February 1: President Trump signs executive orders enacting tariffs on goods from China, Canada and Mexico entering the United States, to be enforced from February 4. This order directs 10% tariffs on Chinese imports, 25% tariffs on Mexican imports, and 25% on all non-energy/oil imports from Canada. Canadian oil and energy imports are subject to 10% tariffs. 
 

Create an agile supply chain despite new tariffs

Building a more agile supply chain is necessary for companies across all industries. And with all the tariffs changing how supply chains produce and ship their products, now is the best time to start.

Discover More