The Trump administration on Tuesday proposed sweeping new tariffs of up to 12.5% on imports from 60 economies, including closest allies like Canada, Mexico, and the European Union, over a collective failure to curb trade involving forced labour.
The Office of the United States Trade Representative (USTR) announced the aggressive measures following a series of Section 301 investigations launched earlier this year. The administration turned to Section 301 laws after the US Supreme Court struck down its previous attempt to impose broad, baseline tariffs using emergency executive powers.
According to official USTR findings, the targeted nations’ lax approach to preventing forced-labour imports places an "unreasonable" and unfair commercial burden on US companies, which operate under strict domestic supply chain regulations. The proposed policy divides the penalised nations into a strict, two-tiered economic penalty framework based entirely on the strength of their domestic legal systems.
Fifteen economies that maintain anti-forced-labour laws but fail to enforce them adequately—including the United Kingdom and Mexico—will face a 10% additional import duty. The remaining 45 economies, including Japan, India, South Korea, and Switzerland, face a harsher 12.5% tariff for lacking sufficient legal prohibitions entirely.
To insulate the domestic economy from immediate supply shocks, the USTR is carving out strategic exemptions for vital industrial sectors. Energy products, rare earth minerals, pharmaceuticals, and select agricultural goods will be shielded from the new duties, though a separate, targeted mechanism for the textile sector is actively under consideration.
Foreign governments and trade groups have a narrow window to lobby against the plan before it is finalised. The USTR has opened a public consultation period running through July 6, 2026, and has scheduled a formal public hearing for July 7, 2026, to review testimony before implementing the final trade directives.