President Donald Trump has taken the first step toward implementing a “reciprocal” tariff system, potentially reshaping U.S. trade policy. This move could lead to higher tariffs on imports from countries deemed to have unfair trade practices. While the administration says the process will take weeks or months, the proposal signals a major shift from traditional U.S. trade norms.
Trump Moves Toward Reciprocal Tariffs on Global Trade
President Donald Trump signed a presidential memorandum on February 13, 2025, outlining a plan to impose reciprocal tariffs on imports. The White House argues that the current trade system disadvantages the U.S. by allowing other countries to impose higher tariffs and non-tariff barriers on American goods.
The Reason Behind the Reciprocal Tariff Plan
The administration claims that the lack of reciprocity in global trade has contributed to the U.S. trade deficit. Trump’s executive order mandates federal agencies to investigate trade barriers imposed by other nations and propose new tariff rates accordingly.
Process and Timeline for Implementation
Commerce Secretary Howard Lutnick and U.S. Trade Representative Jamieson Greer are leading a study on global tariff rates. The White House estimates that determining specific tariffs for each country could take weeks or months. Various trade laws, including Section 301 of the Trade Act of 1974 and Section 232 of the Trade Expansion Act of 1962, could be used to justify the new tariff structure.
How This Plan Differs from Traditional U.S. Trade Policy
Currently, the U.S. follows a most-favored-nation (MFN) tariff system, which applies standard tariffs across nearly all trading partners. The proposed reciprocal tariff system would introduce country-specific rates, marking a departure from long-standing trade practices.
Potential Global Economic Impacts
If implemented, the policy could lead to trade disputes and retaliation from major U.S. partners, including China and the European Union. Experts warn that such a system could disrupt global supply chains and increase costs for American consumers and businesses.
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