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President Donald Trump will raise his new global tariff rate to 15 per cent from 10 per cent, a day after the US Supreme Court struck down the backbone of his economic plan.
Following the devastating blow from the country’s top court on Friday, Trump signed a proclamation slapping a temporary 10 per cent duty on imports under section 122 of the Trade Act of 1974, which allows the president to set import restrictions for up to 150 days.
It was one of the alternative measures he vowed to use after the Supreme Court ruled he had exceeded his authority in using the International Emergency Economic Powers Act to impose tariffs on dozens of countries.
On Saturday, however, Trump said in a social media post that he was “effective immediately, raising the 10% Worldwide Tariff on Countries, many of which have been ‘ripping’ the U.S. off for decades, without retribution (until I came along!), to the fully allowed, and legally tested, 15% level”.
He added: “During the next short number of months, the Trump Administration will determine and issue the new and legally permissible Tariffs.”
The court’s ruling has left the administration rushing to implement back-up plans to maintain some levies. It has also left $142bn in tariff revenue in limbo, with US businesses already demanding refunds.
Simon Evenett, professor of geopolitics and strategy at IMD Business School in Lausanne, Switzerland, said the decision by the White House was probably designed to reduce the incentive for countries to increase imports to the US under the 10 per cent tariff announced on Friday.
“For many countries that were hit by very high IEEPA tariffs of 20 or more per cent, the 10 per cent tariff would have been a sizeable cut for a temporary period, which could have driven a surge of exports to the US to take advantage of the lower rate,” he said.
Friday’s proclamation was set to take effect at 12.01am Eastern Time on Tuesday. The White House did not immediately respond to a question about whether the 15 per cent levy would go into effect on that day.
The proclamation said the 10 per cent tariff was to “to address fundamental international payments problems” and rebalance trade relationships.
It has some exemptions, including critical minerals, some metals, pharmaceuticals, beef, certain aerospace products and vehicles.