Potential implications of tariffs on China, Mexico, and Canada as announced by President-elect Trump
Additional 10% tariff on Chinese goods and 25% additional tariff on goods from Mexico and Canada
Multiple news outlets on November 26, 2024, reported that President-elect Donald Trump announced plans to impose significant tariffs on imports from China, Mexico, and Canada, effective January 20, 2025, the first day of his new administration. The proposed tariffs include an additional 10% tariff on all Chinese goods and a 25% additional tariff on all goods from Mexico and Canada.
President-elect Trump has not yet detailed the method for implementing these tariffs or specified if any goods will be excluded from the additional tariffs. Given the announcement that these new tariffs will go into effect the first day of his new administration, however, it may be that he intends to invoke the International Emergency Economic Powers Act (IEEPA). The IEEPA authorizes the president to impose tariffs during a national emergency.
The potential implications if the proposed tariffs are enacted include:
- Increased duty rates: These tariffs could lead to higher duty rates on a broad array of imports including vehicles and automotive components, electronics, textiles, furniture, oil and gas, and more.
- Retaliatory tariffs: China, Mexico, and Canada may respond with their own tariffs on U.S. goods.