New United States tariffs of 10 percent and 12.5 percent took effect at 12:01 a.m. Eastern on July 24, 2026, covering 60 economies that account for 99.4 percent of US imports.3 FreightWaves 2026-07-24 The duties took effect at 12:01 a.m. EDT on July 24, 2026, cover 60 economies representing 99.4 percent of US imports, set 10 percent for 17 economies and 12.5 percent for 38 others, with combined rate caps for the EU, Taiwan, Japan, South Korea and Switzerland, and a short grace window for goods in transit. Open source They landed at the same minute a temporary global 10 percent tariff expired, a stopgap the administration had used after the Supreme Court ruled in February 2026 that duties imposed under the International Emergency Economic Powers Act were unlawful.4 KPBS 2026-07-24 The temporary global 10 percent tariff expired at 12:01 a.m. Eastern on July 24, 2026, after the Supreme Court ruled in February 2026 that IEEPA tariffs were unlawful; Trump said other alternatives would be used to replace what the court rejected, and polling shows disapproval of tariffs. Open source The new duties are imposed instead under Section 301 of the Trade Act of 1974, following investigations into how each economy enforces bans on goods produced with forced labor.2 Euronews 2026-07-24 The duties on 60 economies rest on Section 301 of the Trade Act of 1974, replace an expiring 10 percent global tariff, and exempt oil, gas, fertilizer and goods qualifying under the North American trade agreement. Open source The stake is durability: the headline rate barely moved, but the authority beneath it changed from an emergency power a court rejected to a trade statute with a documented investigative record. We assess with moderate confidence that this round proves harder to unwind in court than its predecessor, and that trading partners will therefore shift from litigation watching to negotiation and retaliation planning.

What actually changed under the hood

The rate structure is a two tier grade of other countries' enforcement records rather than a bargaining number. USTR set 10 percent for economies that prohibit forced labor imports or hold reciprocal trade commitments, and 12.5 percent for the rest.5 Office of the U.S. Trade Representative 2026-07-23 USTR investigations opened March 12, 2026, included two rounds of hearings and more than 2,100 public comments; 10 percent applies to economies that prohibit forced labor imports or hold reciprocal trade agreements and 12.5 percent to the rest, with exclusions for goods unavailable domestically or causing economic disruption. Open source In practice that put 17 economies at 10 percent, including Canada, Mexico, India and the United Kingdom, and 38 at 12.5 percent, including China, Australia, Brazil, Thailand, Vietnam and South Africa, with combined rate caps applied for the European Union, Taiwan, Japan, South Korea and Switzerland.3 FreightWaves 2026-07-24 The duties took effect at 12:01 a.m. EDT on July 24, 2026, cover 60 economies representing 99.4 percent of US imports, set 10 percent for 17 economies and 12.5 percent for 38 others, with combined rate caps for the EU, Taiwan, Japan, South Korea and Switzerland, and a short grace window for goods in transit. Open source Exemptions carve out oil, natural gas, fertilizer, certain foods, raw materials not available domestically and goods qualifying under the North American trade agreement.2 Euronews 2026-07-24 The duties on 60 economies rest on Section 301 of the Trade Act of 1974, replace an expiring 10 percent global tariff, and exempt oil, gas, fertilizer and goods qualifying under the North American trade agreement. Open source

The procedural record is the point. USTR opened the investigations on March 12, 2026, held two rounds of public hearings, took more than 2,100 public comments, and issued determinations before acting.5 Office of the U.S. Trade Representative 2026-07-23 USTR investigations opened March 12, 2026, included two rounds of hearings and more than 2,100 public comments; 10 percent applies to economies that prohibit forced labor imports or hold reciprocal trade agreements and 12.5 percent to the rest, with exclusions for goods unavailable domestically or causing economic disruption. Open source Ambassador Jamieson Greer framed the action around the argument that "decades of moral suasion have not eradicated forced labor" from supply chains.5 Office of the U.S. Trade Representative 2026-07-23 USTR investigations opened March 12, 2026, included two rounds of hearings and more than 2,100 public comments; 10 percent applies to economies that prohibit forced labor imports or hold reciprocal trade agreements and 12.5 percent to the rest, with exclusions for goods unavailable domestically or causing economic disruption. Open source Goods already in transit before July 24 were given a short grace window.3 FreightWaves 2026-07-24 The duties took effect at 12:01 a.m. EDT on July 24, 2026, cover 60 economies representing 99.4 percent of US imports, set 10 percent for 17 economies and 12.5 percent for 38 others, with combined rate caps for the EU, Taiwan, Japan, South Korea and Switzerland, and a short grace window for goods in transit. Open source We assess with high confidence that this paperwork is not decoration: the IEEPA tariffs failed because the statute was read as not authorizing them, and Section 301 is a delegation built precisely for findings that a foreign practice is unreasonable and burdens US commerce.2 Euronews 2026-07-24 The duties on 60 economies rest on Section 301 of the Trade Act of 1974, replace an expiring 10 percent global tariff, and exempt oil, gas, fertilizer and goods qualifying under the North American trade agreement. Open source The president signalled the substitution openly, saying other alternatives would now be used to replace what the court rejected.4 KPBS 2026-07-24 The temporary global 10 percent tariff expired at 12:01 a.m. Eastern on July 24, 2026, after the Supreme Court ruled in February 2026 that IEEPA tariffs were unlawful; Trump said other alternatives would be used to replace what the court rejected, and polling shows disapproval of tariffs. Open source

Why allies read this as pretext

The objections from partners are not about the money so much as the label. Australian Trade Minister Don Farrell called the 12.5 percent rate on Australian exports unjustified and described it as "an extremely disappointing decision."1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source New Zealand Prime Minister Christopher Luxon said the US investigation did not produce meaningful evidence on forced labor.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source EU foreign policy chief Kaja Kallas argued that European labor protections exceed US standards, which undercuts the premise of the finding.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source Brazil's president rejected the measure and accused Washington of manipulating human rights concerns for protectionist ends, and Brazil signalled retaliation.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source Japan expressed regret and pointed to its compliance with international standards.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source

Note the sourcing shape here: the allied reactions are reported by news outlets summarizing official statements, not drawn from the governments' own published texts, and the US determinations are the administration's own conclusions rather than independently adjudicated findings. The gap between those two evidence classes is exactly what the dispute is about. We assess with moderate confidence that the forced labor framing was chosen at least partly for its legal utility under Section 301, because a rate schedule that sorts close allies such as Australia and New Zealand at 12.5 percent while placing the European Union and United Kingdom at 10 percent tracks a policy checklist more closely than it tracks any plausible ranking of actual forced labor exposure.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source 3 FreightWaves 2026-07-24 The duties took effect at 12:01 a.m. EDT on July 24, 2026, cover 60 economies representing 99.4 percent of US imports, set 10 percent for 17 economies and 12.5 percent for 38 others, with combined rate caps for the EU, Taiwan, Japan, South Korea and Switzerland, and a short grace window for goods in transit. Open source

Second order effects and the ledger

Who gains. US customs revenue gains a stream that is now anchored to a statute with a completed investigative record rather than one under active constitutional challenge, which reduces the refund liability that hangs over an invalidated tariff.4 KPBS 2026-07-24 The temporary global 10 percent tariff expired at 12:01 a.m. Eastern on July 24, 2026, after the Supreme Court ruled in February 2026 that IEEPA tariffs were unlawful; Trump said other alternatives would be used to replace what the court rejected, and polling shows disapproval of tariffs. Open source Domestic producers competing with imports from the 38 economies at 12.5 percent gain the wider margin, since their foreign competitors carry a rate 2.5 points above the 17 economy tier.3 FreightWaves 2026-07-24 The duties took effect at 12:01 a.m. EDT on July 24, 2026, cover 60 economies representing 99.4 percent of US imports, set 10 percent for 17 economies and 12.5 percent for 38 others, with combined rate caps for the EU, Taiwan, Japan, South Korea and Switzerland, and a short grace window for goods in transit. Open source Exporters in the exempted categories gain relatively, particularly energy and fertilizer suppliers and North American producers whose goods qualify under the regional agreement, because their rivals in taxed categories absorb the cost while they do not.2 Euronews 2026-07-24 The duties on 60 economies rest on Section 301 of the Trade Act of 1974, replace an expiring 10 percent global tariff, and exempt oil, gas, fertilizer and goods qualifying under the North American trade agreement. Open source Trade compliance and customs advisory firms gain work from 60 simultaneous tariff determinations with product level exclusions.5 Office of the U.S. Trade Representative 2026-07-23 USTR investigations opened March 12, 2026, included two rounds of hearings and more than 2,100 public comments; 10 percent applies to economies that prohibit forced labor imports or hold reciprocal trade agreements and 12.5 percent to the rest, with exclusions for goods unavailable domestically or causing economic disruption. Open source

Who loses. Australia and New Zealand lose the most relative to expectation, landing in the higher tier despite being treaty allies, and Australia's trade ministry has said so publicly.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source Brazil compounds an existing burden, since the new duty sits on top of earlier tariffs applied to Brazilian goods.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source US importers and the downstream firms they supply lose, because a duty covering 99.4 percent of import value is close to a general consumption tax on traded goods with only category exemptions to route around.3 FreightWaves 2026-07-24 The duties took effect at 12:01 a.m. EDT on July 24, 2026, cover 60 economies representing 99.4 percent of US imports, set 10 percent for 17 economies and 12.5 percent for 38 others, with combined rate caps for the EU, Taiwan, Japan, South Korea and Switzerland, and a short grace window for goods in transit. Open source Companies that had been provisioning for tariff refunds after the February ruling lose that expected recovery on forward purchases, because the replacement restores the cost on a different legal footing.4 KPBS 2026-07-24 The temporary global 10 percent tariff expired at 12:01 a.m. Eastern on July 24, 2026, after the Supreme Court ruled in February 2026 that IEEPA tariffs were unlawful; Trump said other alternatives would be used to replace what the court rejected, and polling shows disapproval of tariffs. Open source

The counter-case

The strongest argument against the assessment is that Section 301 is not the safe harbor it appears to be. The statute was written for tariffs targeted at a specific foreign practice, and applying it simultaneously to 60 economies covering nearly all US imports invites the argument that this is a general revenue tariff wearing a Section 301 label, which is a version of the reasoning that sank the IEEPA duties.2 Euronews 2026-07-24 The duties on 60 economies rest on Section 301 of the Trade Act of 1974, replace an expiring 10 percent global tariff, and exempt oil, gas, fertilizer and goods qualifying under the North American trade agreement. Open source 4 KPBS 2026-07-24 The temporary global 10 percent tariff expired at 12:01 a.m. Eastern on July 24, 2026, after the Supreme Court ruled in February 2026 that IEEPA tariffs were unlawful; Trump said other alternatives would be used to replace what the court rejected, and polling shows disapproval of tariffs. Open source Partners who say the record contains no meaningful evidence on forced labor are, in effect, previewing that challenge.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source If a court accepts it, the durability thesis fails and the refund exposure returns larger than before. There is also a political limit that no statute fixes: tariffs poll badly with Americans, and approval on economic management has fallen.4 KPBS 2026-07-24 The temporary global 10 percent tariff expired at 12:01 a.m. Eastern on July 24, 2026, after the Supreme Court ruled in February 2026 that IEEPA tariffs were unlawful; Trump said other alternatives would be used to replace what the court rejected, and polling shows disapproval of tariffs. Open source A legally sturdy tariff can still be repealed by an administration that needs prices to come down.

What to watch

  • A Section 301 challenge is filed and survives a motion to dismiss. Watch for importer or state litigation in the next one to two quarters. Dismissal early would confirm the durability read; a case allowed to proceed on the scope question would put the whole 60 economy structure back in play.2 Euronews 2026-07-24 The duties on 60 economies rest on Section 301 of the Trade Act of 1974, replace an expiring 10 percent global tariff, and exempt oil, gas, fertilizer and goods qualifying under the North American trade agreement. Open source
  • Australia and New Zealand move from statements to instruments. If either files a WTO complaint or announces countermeasures rather than seeking a bilateral carve out by year end, the allied tier split has done lasting damage.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source
  • Brazil executes the retaliation it signalled. Brazil has said it is preparing measures. Actual retaliatory duties within roughly a quarter would mark the first hard escalation of this round; silence would suggest the threats are bargaining posture.1 NPR (WGCU) 2026-07-24 Allies including Australia, New Zealand, the EU, Japan and Brazil rejected the forced labor justification; Australian Trade Minister Don Farrell called the 12.5 percent rate unjustified and an extremely disappointing decision, New Zealand PM Christopher Luxon said the investigation lacked meaningful evidence, and EU foreign policy chief Kaja Kallas said EU labor protections exceed US standards. Open source
  • The exclusion list grows fast. Track the volume of product exclusions granted under the unavailable domestically and economic disruption categories over the next two quarters. A rapidly expanding list would show effective rates falling well below the headline 10 and 12.5 percent.5 Office of the U.S. Trade Representative 2026-07-23 USTR investigations opened March 12, 2026, included two rounds of hearings and more than 2,100 public comments; 10 percent applies to economies that prohibit forced labor imports or hold reciprocal trade agreements and 12.5 percent to the rest, with exclusions for goods unavailable domestically or causing economic disruption. Open source
  • Tier movement is offered as a bargaining chip. If any 12.5 percent economy is moved to 10 percent after enacting a forced labor import ban, the policy is functioning as stated and other partners will legislate toward it; if no one moves despite compliance steps, the tiers were a pricing exercise.5 Office of the U.S. Trade Representative 2026-07-23 USTR investigations opened March 12, 2026, included two rounds of hearings and more than 2,100 public comments; 10 percent applies to economies that prohibit forced labor imports or hold reciprocal trade agreements and 12.5 percent to the rest, with exclusions for goods unavailable domestically or causing economic disruption. Open source

The next fight will not be over 2.5 percentage points. It will be over whether a trade statute written for targeted disputes can carry a tariff that touches nearly every import, and the answer sets the ceiling on what any future administration can do without Congress.