Further Modifying the Reciprocal Tariff Rates
President Donald J. Trump issued an order further modifying reciprocal tariff rates, adjusting duties on goods from various countries and territories.
The action builds upon Executive Order 14257, addressing the national security and economic threats stemming from large and persistent U.S. goods trade deficits.
The order modifies the Harmonized Tariff Schedule of the United States(HTSUS), with adjustments based on progress in trade negotiations and security agreements with certain partners.
Specific tariff rates are provided in Annex I, with Annex II detailing further HTSUS modifications.
The order tasks multiple agencies with implementation, establishes penalties for transshipment to evade duties, and includes monitoring mechanisms to review the effectiveness of these actions and inform future presidential decisions.
Arguments For
Intended benefits: The order aims to rectify trade imbalances, bolster the domestic manufacturing base, strengthen critical supply chains, and enhance national security by imposing tariffs on nations not cooperating in trade or security matters. The adjustments to tariffs reflect progress made in negotiations with certain partners.
Evidence cited: The order cites additional information and recommendations from senior officials regarding bilateral trade relationships, foreign tariff rates and barriers, their impact on U.S. exports, and efforts to align on economic and national security matters. It notes that certain trading partners have agreed to, or are on the verge of agreeing to, meaningful trade and security commitments.
Implementation methods: The order modifies the Harmonized Tariff Schedule of the United States (HTSUS) via Annex II, providing specific changes to tariff rates. This includes a 10% tariff for non-listed partners, adjustments for the European Union based on existing rates, and provisions for transshipment evasion. The Secretary of Commerce, the United States Trade Representative, and other agencies are assigned responsibilities to implement the order.
Legal/historical basis: The order uses the president's authority under the International Emergency Economic Powers Act (IEEPA), the National Emergencies Act, the Trade Act of 1974, and title 3, United States Code, building upon Executive Order 14257 (April 2, 2025).
Arguments Against
Potential impacts: Increased tariffs on specific goods could lead to higher prices for consumers, potentially impacting inflation. Retaliatory measures from affected countries could negatively impact U.S. exports and businesses. The complexity of the tariff system may present challenges for businesses to comply with the new rates.
Implementation challenges: The effective implementation of the tariff modifications across various international trade channels may prove difficult and potentially costly. Enforcement against transshipment to evade duties will require significant monitoring and oversight. Updating and disseminating information to industry stakeholders about the changing tariff rates may challenge businesses' ability to adapt.
Alternative approaches: Alternative strategies like bilateral trade negotiations and diplomatic efforts might have been considered to address trade and national security concerns before resorting to broad tariff changes. Greater consideration could have been given to the varied impact on businesses and consumers.
Unintended effects: Unforeseen disruptions to global supply chains or unintended economic consequences might arise from the altered tariff structure. A reliance on tariffs without coordinated international cooperation could lead to escalation in trade disputes and further economic instability.
By the authority vested in me as President by the Constitution and the laws of the United States of America, including the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C. 1601 et seq.), section 604 of the Trade Act of 1974, as amended (19 U.S.C. 2483), and section 301 of title 3, United States Code, I hereby determine and order:
The President asserts his constitutional and statutory authority to issue this order.
This legal basis cites several acts, notably the International Emergency Economic Powers Act, to justify the imposition and modification of tariffs.
This establishes the legal foundation of the presidential action.
Section 1. Background. In Executive Order 14257 of April 2, 2025 (Regulating Imports With a Reciprocal Tariff To Rectify Trade Practices That Contribute to Large and Persistent Annual United States Goods Trade Deficits), I found that conditions reflected in large and persistent annual U.S. goods trade deficits constitute an unusual and extraordinary threat to the national security and economy of the United States that has its source in whole or substantial part outside the United States. I declared a national emergency with respect to that threat, and to deal with that threat, I imposed additional ad valorem duties that I deemed necessary and appropriate.
This section provides context by referencing the prior Executive Order 14257, declaring a national emergency due to significant U.S. goods trade deficits.
This prior order established the basis for imposing tariffs.
This section posits that these deficits are a threat to the nation's security and economy.
I have received additional information and recommendations from various senior officials on, among other things, the continued lack of reciprocity in our bilateral trade relationships and the impact of foreign trading partners’ disparate tariff rates and non-tariff barriers on U.S. exports, the domestic manufacturing base, critical supply chains, and the defense industrial base. I also have received additional information and recommendations on foreign relations, economic, and national security matters, including the status of trade negotiations, efforts to retaliate against the United States for its actions to address the emergency declared in Executive Order 14257, and efforts to align with the United States on economic and national security matters.
The President explains that new information and recommendations prompted this modification of tariffs.
These recommendations highlight ongoing trade reciprocity issues and the effect of foreign trade practices on various U.S. sectors.
This information covers various matters related to negotiations, retaliation concerns, and alignment on economic and national security.
For example, some trading partners have agreed to, or are on the verge of agreeing to, meaningful trade and security commitments with the United States, thus signaling their sincere intentions to permanently remedy the trade barriers that have contributed to the national emergency declared in Executive Order 14257, and to align with the United States on economic and national security matters. Other trading partners, despite having engaged in negotiations, have offered terms that, in my judgment, do not sufficiently address imbalances in our trading relationship or have failed to align sufficiently with the United States on economic and national-security matters. There are also some trading partners that have failed to engage in negotiations with the United States or to take adequate steps to align sufficiently with the United States on economic and national security matters.
The President explains the varied responses from different trading partners.
Some partners are cooperating and negotiating agreements, while others are not meeting the required standards for trade and security alignment with the U.S. This justifies the differential treatment presented in subsequent sections.
After considering the information and recommendations that I have recently received, among other things, I have determined that it is necessary and appropriate to deal with the national emergency declared in Executive Order 14257 by imposing additional ad valorem duties on goods of certain trading partners at the rates set forth in Annex I to this order, subject to all applicable exceptions set forth in Executive Order 14257, as amended, in lieu of the additional ad valorem duties previously imposed on goods of such trading partners in Executive Order 14257, as amended.
Based on the recent information received, the President decides that further actions are needed.
This involves revised tariffs in Annex I will replace those previously imposed, reflecting the different responses seen from trading partners.
This aims to manage this national emergency.
Sec. 2. Tariff Modifications. (a) The Harmonized Tariff Schedule of the United States (HTSUS) shall be modified as provided in Annex II to this order. These modifications shall be effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time 7 days after the date of this order, except that goods loaded onto a vessel at the port of loading and in transit on the final mode of transit before 12:01 a.m. eastern daylight time 7 days after the date of this order, and entered for consumption, or withdrawn from warehouse for consumption, before 12:01 a.m. eastern daylight time on October 5, 2025, shall not be subject to such additional duty and shall instead remain subject to the additional ad valorem duties previously imposed in Executive Order 14257, as amended.
This section details the specific modifications to the HTSUS, which houses the tariff schedules.
The modifications outlined in Annex II take effect seven days after the order's issuance, with an exception for goods already in transit.
This ensures a degree of fairness for importers that have already started the shipment process.
(b) Certain foreign trading partners identified in Annex I to this order have agreed to, or are on the verge of concluding, meaningful trade and security agreements with the United States. Goods of those trading partners will remain subject to the additional ad valorem duties provided in Annex I to this order until such time as those agreements are concluded, and I issue subsequent orders memorializing the terms of those agreements.
This subsection clarifies that the tariffs on partners cooperating in trade negotiations will remain in place until formal agreements have been finalized, with subsequent orders adjusting these following agreements.
(c) As provided in Annex I to this order, the additional ad valorem rate of duty applicable to any good of the European Union is determined by the good’s current ad valorem (or ad valorem equivalent) rate of duty under column 1 (General) of the HTSUS ("Column 1 Duty Rate"). For a good of the European Union with a Column 1 Duty Rate that is less than 15 percent, the sum of its Column 1 Duty Rate and the additional ad valorem rate of duty pursuant to this order shall be 15 percent. For a good of the European Union with a Column 1 Duty Rate that is at least 15 percent, the additional ad valorem rate of duty pursuant to this order shall be zero.
Tariff treatment for the European Union is specified, with changes depending on their already existing tariff rates.
If the current rate is less than 15%, the additional duty will be added to achieve a 15% total; if the current rate is at least 15%, no additional duty will be imposed.
(d) Goods of any foreign trading partner that is not listed in Annex I to this order will be subject to an additional ad valorem rate of duty of 10 percent pursuant to the terms of Executive Order 14257, as amended, unless otherwise expressly provided. This rate shall be effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time 7 days after the date of this order.
For countries not mentioned in Annex I, a standard 10% additional duty applies, consistent with the previous order, unless explicitly stated otherwise.
(e) The HTSUS shall also be modified by continuing to suspend headings 9903.01.43 through 9903.01.62 and 9903.01.64 through 9903.01.76, and subdivisions (v)(xiii)(1)–(9) and (11)‑(57) of U.S. note 2 to subchapter III of chapter 99 of the HTSUS, until the effective date of the modifications provided in Annex II to this order. Upon the effective date of the modifications provided in Annex II to this order, to facilitate implementation of the rates of duty provided in Annex I to this order, headings 9903.01.43 through 9903.01.62 and 9903.01.64 through 9903.01.76, which are organized by rate of duty, and subdivisions (v)(xiii) (1)-(9) and (11)-(57) of U.S. note 2 to subchapter III of chapter 99 of the HTSUS shall be terminated as to future entries and replaced by the new trading partner-specific headings provided in Annex II to this order.
This section details technical changes to specific headings within the HTSUS, temporarily suspending some and replacing others to effectively implement the new tariff rates in Annex I and II. These are administrative changes necessary for the full implementation of the tariff modifications.
(f) Excluding the changes set forth in subsections (a) through (d) of this section, the terms of Executive Order 14257, as amended, shall continue to apply.
All aspects of the prior executive order still hold, unless explicitly contradicted by these modifications.
(g) Nothing in this order shall be construed to alter or otherwise affect Executive Order 14298 of May 12, 2025 (Modifying Reciprocal Tariff Rates To Reflect Discussions With the People’s Republic of China).
This clarifies that this order does not affect a separate order concerning tariffs with China (Executive Order 14298).
(h) The Secretary of Commerce and the United States Trade Representative, in consultation with the Secretary of Homeland Security, acting through the Commissioner of U.S. Customs and Border Protection (CBP), and the Chair of the United States International Trade Commission, shall determine whether any additional modifications to the HTSUS are necessary to effectuate this order and may make such modifications through notice in the Federal Register.
The Secretaries of Commerce and Homeland Security, along with the USTR and others, will assess and implement any further necessary adjustments via notices in the Federal Register.
Sec. 3. Transshipment. (a) An article determined by CBP to have been transshipped to evade applicable duties under section 2 of this order shall be subject to (i) an additional ad valorem rate of duty of 40 percent, in lieu of the additional ad valorem rate of duty applicable under section 2 of this order to goods of the country of origin, (ii) any other applicable or appropriate fine or penalty, including those assessed under 19 U.S.C. 1592, and (iii) any other United States duties, fees, taxes, exactions, or charges applicable to goods of the country of origin. CBP shall not allow, consistent with applicable law, for mitigation or remission of the penalties assessed on imports found to be transshipped to evade applicable duties.
This section addresses efforts to circumvent tariffs through transshipment (routing goods through third countries to avoid tariffs).
Goods found to be illegally transshipped will face a 40% additional duty plus additional fines and penalties.
Penalties are also non-mitigatable.
(b) The Secretary of Commerce and the Secretary of Homeland Security, acting through the Commissioner of CBP, in consultation with the United States Trade Representative, shall publish every 6 months a list of countries and specific facilities used in circumvention schemes, to inform public procurement, national security reviews, and commercial due diligence.
To combat transshipment, a semi-annual report will be published naming countries and facilities involved to inform public procurement processes and enhance transparency.
Sec. 4. Implementation. The Secretary of Commerce, the Secretary of Homeland Security, and the United States Trade Representative, as applicable, in consultation with the Secretary of State, the Secretary of the Treasury, the Assistant to the President for Economic Policy, the Assistant to the President and Senior Counselor for Trade and Manufacturing, the Assistant to the President for National Security Affairs, and the Chair of the International Trade Commission, are directed and authorized to take all necessary actions to implement and effectuate this order, consistent with applicable law, including through temporary suspension or amendment of regulations or notices in the Federal Register and by adopting rules, regulations, or guidance, and to employ all powers granted to the President by IEEPA, as may be necessary to implement this order. Each executive department and agency shall take all appropriate measures within its authority to implement this order.
Specific agencies are tasked with implementing this order, ensuring that all necessary actions are taken, utilizing all relevant legal powers granted to President Trump.
They may change regulations as necessary to facilitate the implementation of this order and its aims.
Sec. 5. Monitoring and Recommendations. (a) The Secretary of Commerce and the United States Trade Representative shall monitor the circumstances involving the emergency declared in Executive Order 14257 and shall regularly consult on such circumstances with any senior official they deem appropriate. The Secretary of Commerce and the United States Trade Representative shall inform me of any circumstance that, in their opinion, might indicate the need for further action by the President. The Secretary of Commerce and the United States Trade Representative shall also inform me of any circumstance that, in their opinion, might indicate that a foreign trading partner has taken adequate steps to address the emergency declared in Executive Order 14257.
The Secretaries of Commerce and the USTR are responsible for monitoring the effectiveness of this order and report back to the President as appropriate.
This ensures presidential oversight and the possibility of future adjustments.
(b) The Secretary of Commerce and the United States Trade Representative, in consultation with any senior official they deem appropriate, shall recommend to me any necessary additional action if this action is not effective in resolving the emergency declared in Executive Order 14257.
If this strategy is found to be ineffective, further recommendations for action will be forwarded to the President.
(c) The Secretary of Commerce and the United States Trade Representative, in coordination with the appropriate senior officials, shall recommend additional action, if necessary, should a foreign trading partner fail to take adequate steps to address the emergency declared in Executive Order 14257 or should a foreign trading partner retaliate against the United States in response to the actions taken to address the emergency declared in Executive Order 14257 or any subsequent order issued to address that emergency.
Continued monitoring is ensured, providing the capability to react to any further actions from foreign trading partners.
Retaliatory acts from foreign partners will also be monitored and reported upon so further presidential action may be taken.
Sec. 6. Severability. If any provision of this order, or the application of any provision of this order to any individual or circumstance, is held to be invalid, the remainder of this order and the application of its provisions to any other individuals or circumstances shall not be affected.
This is a standard legal clause, ensuring that if any part of the order is deemed invalid, it does not impact the remainder of the order's validity.
Sec. 7. General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect:
(i) the authority granted by law to an executive department or agency, or the head thereof; or
(ii) the functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals.
This section establishes that the order's implementation will not restrict the legal and operational functions of various executive departments or agencies, including the Office of Management and Budget.
(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
Implementation adheres to existing legislation and the availability of funding.
(c) This order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
This standard legal disclaimer clarifies that no new legal rights or benefits are created, and the order cannot be used by any party to sue the U.S. government.
(d) The costs for publication of this order shall be borne by the Office of the United States Trade Representative.
The USTR office handles costs of publication.
DONALD J. TRUMP
THE WHITE HOUSE,
July 31, 2025.
Signature and date of the order.
ANNEX I
[Table of Countries and Reciprocal Tariffs]
Annex I lists the countries and territories affected by the order and their corresponding adjusted reciprocal tariffs.
It's a detailed table of the modifications.
[1] For purposes of this Executive Order and its Annexes, “Column 1 Duty Rate” means the ad valorem (or ad valorem equivalent) rate of duty under column 1-General of the Harmonized Tariff Schedule of the United States (HTSUS).
Defines "Column 1 Duty Rate" as being used for subsequent interpretation.
CLICK HERE TO VIEW ANNEX II
Hyperlink to view Annex II detailing HTSUS modifications.