US tariffs

On 3 April, President Trump announced a series of tariff measures on the import of goods into the US.

The announcement was followed by an Executive Order which results in:

Goods imported from all countries into the US from 5 April 2025 will be subject to a baseline tariff of 10%.
For selected territories including the EU, higher “Reciprocal tariff” rates will apply from 9 April onwards.

A chart of selected countries and tariff rates is set out below.

It should be noted that the baseline tariff of 10% is in addition to the normal duty rate that applies to the import of goods into the US today.

Whilst the wording on the Reciprocal Tariffs is less clear, we are operating on the basis such tariffs will also be in addition to normal duty rates.

Timing

The baseline tariff and Reciprocal Tariff rates become effective on 5 April and 9 April respectively.

US tariffs by country

EMEA	Reciprocal Tariffs (%)
European Union	20
United Kingdom	10
Norway	15
Saudi Arabia	10
South Africa	30
Switzerland	31
Ukraine	10

APAC	Reciprocal Tariffs (%)
China	34
Australia	10
India	26
Japan	24
South Korea	25
Taiwan	32
Vietnam	46

LATAM	Reciprocal Tariffs (%)
Argentina	10
Brazil	10
Chile	10
Colombia	10
Costa Rica	10
Dominican Republic	10
Venezuela	15

What are the implications for importing Irish /EU goods into the US?

All goods of EU origin (including goods of Irish origin) will be subject to these additional tariffs unless falling under an exclusion.

There are limited exclusions but importantly for Ireland pharmaceutical products are currently exempted from these additional tariffs.

It is important to be aware the tariffs are based on the country of origin (not the country of dispatch) and the value. There are rules for determining origin and this is generally based on country of production/last significant transformation and not country of dispatch.

For example, goods made in China shipped to the US from the EU are of Chinese Origin and subject to Chinese reciprocal tariffs (of 34%) not EU reciprocal tariffs (of 20%).

Exclusions

The baseline tariff and Reciprocal Tariff rates do not apply to certain categories of goods, being:

Pharmaceuticals, semi-conductors, lumber, copper, certain critical minerals and energy and energy products
Compliant goods under the USMCA free trade agreement between Mexico, Canada and the United States (noncompliant goods are subject to a 25% rate).
Steel and aluminium, and derivatives thereof which are subject to additional tariffs of 25% imposed on 12 March 2025
Motor vehicles and parts thereof – on 26 March President Trump issued an Executive Order applying a 25% tariff to motor vehicles effective 3 April, which was confirmed 2 April and now in effect, and certain motor vehicle parts (engines and engine parts, transmissions, powertrain parts and electrical components) on 3 May

What will happen next?

The EU is expected to make an announcement on Friday 4 April. It is likely that, at a minimum, the countermeasures the EU were due to implement on 1 April but later postponed will come into effect on or after 15 April.

The EU countermeasures will result in the EU imposing tariffs on a range of imports including Harley- Davidson motorbikes, bourbon, orange juice, jeans, steel and aluminium and impact approximately €6billion of imports from the US.

The EU has also undertaken a consultation to identify a further €18billion of other US products which could be made subject to new EU tariffs. The proposed targeted products include a mixture of industrial and agricultural products (steel and aluminium products, textiles, leather goods, home appliances, house tools, plastics, wood products, poultry, beef, certain seafood, nuts, eggs, dairy, sugar and vegetables).

Given the high Reciprocal Tariff rate applied by the US to EU origin goods, it is likely that further measures will be introduced by the EU.

The US has signalled that President Trump also may increase the US tariff if trading partners retaliate or decrease the tariffs if trading partners take significant steps to remedy non-reciprocal trade arrangements and align with the United States on economic and national security matters.

How that will be interpreted by the EU is yet to be seen, but we expect the EU will as a first step apply a range of tariff countermeasures followed by efforts to negotiate an agreed position with the US, with the threat of additional tariff and non-tariff measures to be applied in the event no agreement is reached.

In this context, Commission President Von Der Leyen has urged negotiations and commented that “We are already finalising a first package of countermeasures in response to tariffs on steel. And we are now preparing for further countermeasures, to protect our interests and our businesses if negotiations fail".

The Irish pharmaceutical industry

Notably pharmaceuticals were not included in the announcement.

However, there is speculation that the sector is being closely examined by the Trump administration and may be targeted by additional US tariff measures in the future.

What does it mean for Northern Ireland?

Products of origin in Northern Ireland should be subject to 10% reciprocal tariffs applying to the United Kingdom and not 20% presenting a lower tariff cost for product of Northern Ireland origin shipped to the US.

The imposition of additional retaliatory tariffs on products of US origin by the EU is likely to complicate the importation process for goods into Northern Ireland from the US. Under the terms of the Windsor Framework this would likely cause the EU tariff rate to apply to US products (as they would be automatically considered ‘at risk’ of moving to the EU), regardless of whether they are for the UK market.

If the goods remain in the UK and this can be evidenced it is possible for the difference between the EU tariff paid and the UK tariff to be reclaimed from the UK under the tariff reimbursement scheme, however, this can be a time-consuming process with a high evidential burden.

What should businesses consider now?

For Irish and EU businesses, these developments necessitate a strategic approach to mitigate potential disruptions. Here are some key considerations:

1. Understand the origin and classification of your goods and your valuation methodology

Ensure you fully understand the origin and classification of goods you sell to the US and the possible tariffs that may apply. This should be clear for products wholly produced in Ireland but may be less clear for products imported into Ireland including from Northern Ireland or which comprise substantial parts imported from other countries.

A similar exercise should be carried out for goods imported from the US to understand if your imports may become subjected to additional EU tariffs which are imminent.

Importantly, and unlike the US measures, it is likely the EU countermeasures will be targeted and product specific and there is not expected to be a blanket tariff applied to all products of US origin.

The customs methodology for valuation of your supplies is also relevant (e.g. transfer pricing methodology).

2. Assess supply chains

Evaluate your supply chains to identify dependencies on US imports and exports. Diversifying suppliers and where possible exploring alternative markets can help reduce vulnerability to tariff impacts.

3. Cost Management

Anticipate increased costs due to tariffs and develop strategies to manage these expenses.

4. Explore customs procedures and other mitigation opportunities.

Depending on your supply chain and operations in Ireland/the EU, there may be benefit in availing of special customs procedures such as Customs Warehousing, and Inward Processing Relief in the EU to mitigate the impact of the EU retaliatory tariffs.

These procedures require a high level of administration and require authorisation in advance.

Similar type mitigation options may be available for goods undergoing processing in the US for eventual export, or goods that may be able to be initially stored/undergo processing in the US before possible sale e.g. foreign zones.

5. Stay informed

Keep abreast of ongoing negotiations and potential changes in trade policies. There may be changes to these measures in the short to medium term and expect news on the EU countermeasures imminently.

Managing geopolitical risk

As global geopolitics continue to shift, staying ahead of the curve is essential for maintaining a competitive edge. So what do Irish business leaders need to consider?

KPMG’s Top Geopolitical Risks 2025 shows how by treating geopolitical risk as a fundamental part of business strategy, companies cannot only address threats but also seize opportunities, paving the way for growth and success.

Top geopolitical risks 2025

Opportunities for businesses to navigate uncertainty with confidence (PDF, 1.2MB)

Download

How can KPMG help?

With a team of over 50 VAT and Customs advisors, KPMG helps businesses manage the uncertainty created by the new US tariffs and EU countermeasures by:

Helping you obtain and analyse your trade data, to provide you with a clear picture of your supply chain and where risks and opportunities lie
Using our tariff tools modelling the impact on the business of new tariff measures
Modelling and quantifying duty costs and opportunities under various “what if” supply chain scenarios
Identifying and taking advantage of bonded warehousing, inward processing, free-trade zones and drawback to achieve savings and minimise duty costs
Reviewing classification and origin to identify opportunities to avoid or minimise increased duty costs
Reviewing valuation methodologies to reduce amounts subject to tariffs
Monitoring developments to keep you informed of the evolving landscape

Contact our Indirect Tax team below to discuss how these tariffs could affect your organisation. We look forward to hearing from you.

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