What are tariffs, how do they work and why is Trump using them?

US President Donald Trump signs an executive order in the Oval Office at the White House in Washington, DC on 23 April 2025.  A red baseball hat embroidered with "Make America Great Again" in white thread sits to the left of the document, which shows Trump's distinctive signature
July 26, 2026

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What are tariffs, how do they work and why is Trump using them?

No. The White House has been looking at alternative ways.

After the Supreme Court ruling, Trump used different legislation – Section 122 of the Trade Act of 1974 – to impose temporary 10% tariffs on all global imports.

Those tariffs expired on 24 July, but have been replaced by tariffs of 10% to 12.5% on all goods from the top 60 US trade partners, including the UK, the EU and China.

The action is being taken under Section 301 of the Trade Act of 1974, based on claims that the US’s economic partners have failed to properly tackle forced labour.

However, one trade expert said the move was not about forced labour but Trump simply looking for a legal way to impose tariffs.

And in recent weeks, he has also used Section 301 to justify imposing tariffs on a range of countries, including a 25% tax on certain goods from Brazil, claiming that Brazilian policies have harmed US trade.

Trump has also announced a 50% tariff on a wide range of goods imported from Canada, in retaliation for what he called “unequal treatment” of US cars, dairy and alcohol, under Section 338 of the Tariff Act of 1930.

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