The Trump administration replaced its own tariff framework before it could expire. On July 23, US Trade Representative Jamieson Greer took final action, on the president’s instruction, under Section 301 of the Trade Act of 1974, imposing duties on 60 economies for failing to introduce and effectively enforce a ban on imports of goods made with forced labor.
The new rates apply to products entered for consumption, or withdrawn from a customs warehouse, starting at 12:01 a.m. Eastern time on July 24, 2026. There is only one grace window: goods already loaded onto a vessel at the port of embarkation and in transit on the final leg before that hour are exempt from the new duty if they clear customs by 12:01 a.m. on July 28.
According to the fact sheet from the USTR (Office of the US Trade Representative), the action targets the United States’ top 60 trading partners and covers 99.4% of US imports.
The rates: who pays 10% and who pays 12.5%
The mechanism distinguishes between economies that have adopted a ban on imports of forced-labor goods and those that have not.
10% rate — Applies to economies that impose a ban on imports of forced-labor goods, that have committed to introducing and enforcing one through an Agreement on Reciprocal Trade, or that have adopted a partial regime with the effect of blocking the import of certain goods. This group includes Argentina, Bangladesh, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Pakistan, Sri Lanka, Trinidad and Tobago, and the United Kingdom.
10% or 12.5% net of the MFN duty — Covers certain products from the European Union, Taiwan, Japan, South Korea, and Switzerland that are not otherwise exempt.
12.5% rate — Applies to all other economies under investigation, including China, Brazil, Vietnam, Turkey, Russia, Thailand, Singapore, Israel, Saudi Arabia, Norway, Australia, and New Zealand.
Greer summed up the logic in an interview with CNN: those on the right track pay about 10%, while those that are not pay a slightly higher rate, 12.5%.
The EU case: how “net of MFN” works
For the EU, the mechanism is different from a simple surcharge. The Federal Register notice specifies that, for a European Union product, when the MFN duty is below 10% the sum of the MFN duty and the Section 301 duty must equal 10%; when the MFN duty is at or above 10%, the Section 301 duty applied is zero.
The same criterion applies to Taiwan, while for Japan, South Korea, and Switzerland the combined ceiling is set at 12.5%. The USTR notes that capping total duties in this way is consistent with the respective Agreements on Reciprocal Trade or similar deals.
This is the most important point for European exporters: it is an all-inclusive ceiling, not a surcharge added on top of the ordinary customs tariff. Also excluded from the action are all articles and parts of articles subject to Section 232 duties, which therefore continue to follow their own regime — steel and aluminum first and foremost.
How this dovetails with the Turnberry agreement still has to be verified product by product. That deal, signed in July 2025 by Donald Trump and Ursula von der Leyen, sets a 15% ceiling on US tariffs on European goods; it took full effect on July 1, 2026, after the European Parliament’s approval on June 16 and the publication of the implementing regulations in the EU Official Journal on June 30. The 10% applied to EU products should remain within that ceiling.
What are MFN duties?
MFN stands for Most Favored Nation, the clause set out in Article I of the GATT (General Agreement on Tariffs and Trade): every member of the WTO (World Trade Organization) must extend to all other members the tariff treatment granted to its most favored partner, except under preferential agreements. The MFN duty is therefore the ordinary customs tariff applied by default, which in the United States corresponds to column 1 of the HTSUS (Harmonized Tariff Schedule of the United States).
The level varies significantly from product to product: close to zero on many machines and semiconductors, around 4-5% on capital equipment, and considerably higher on textiles, apparel, and footwear.
In the July 23 measure, the Section 301 duty on European products is set at 10% net of the MFN: it does not add to the ordinary tariff but tops it up to a combined 10%. If the MFN duty is already at or above 10%, the Section 301 duty is zero and only the MFN is owed.
The exemptions: from coffee to semiconductor equipment
The list of exclusions is long. The action does not cover informational materials, donations, and accompanied baggage, along with all goods already subject to Section 232.
Beyond the exemptions already proposed in June, the USTR excluded a further 471 products. Among them: certain animal products, sowing seeds, quota sugar, unflavored soluble coffee, fertilizer and pesticide inputs, hides and leather, some wood products, vanadium oxides and hydroxides, pig iron, ferrous and aluminum scrap, aluminum hydroxide, battery scrap, semiconductor manufacturing equipment, certain active pharmaceutical ingredients, used garments, and some categories of artwork, antiques, and collectibles.
The measure also provides for the establishment, as soon as technically feasible, of three-year tariff-rate quotas for Bangladesh, Cambodia, Indonesia, and Malaysia, calibrated on their purchases of US cotton and textiles. The presidential memorandum indicates that the quotas cannot be implemented yet but will become operational by September 1, 2026.
Why Washington switched to Section 301
The recourse to Section 301 is a response to a time constraint. On February 20, 2026, the Supreme Court ruled that the president does not have the authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA); the same day, Trump signed an executive order revoking all IEEPA-based tariffs and activating Section 122 of the Trade Act, which allows import surcharges of up to 15% for a maximum of 150 days. The 10% across-the-board tariff took effect on February 24 and was set to expire on July 24, 2026.
That tool was provisional by design and already under challenge. On May 7, 2026, the Court of International Trade found invalid the proclamation that had established the surcharge, because it did not identify the type of balance-of-payments deficit required by the statute. The government appealed to the Court of Appeals for the Federal Circuit.
Section 301, by contrast, is the traditional instrument of US trade policy, has no automatic expiry, and already cleared judicial review when it was used against China during Trump’s first term.
The European reaction
Brussels disputes the framework on the merits. High Representative Kaja Kallas called unfounded the accusations that the EU lacks adequate tools against forced labor. Back in June, the Commission’s trade spokesman, Olof Gill, had said the EU executive takes note of the proposed actions and will continue its dialogue with Washington, but considers tariffs imposed on these grounds unjustified.
The technical point at the center of the European objection is timing: Regulation (EU) 2024/3015, which bans the placing on the EU market of products made with forced labor, is already in force but will apply only from December 14, 2027.
In the course of the inquiry, the USTR rejected the arguments of those seeking lower rates for countries with domestic forced-labor legislation or with ratified ILO (International Labour Organization) conventions, deeming them not relevant to the subject of the investigations, and it also rejected the claim that the tariffs would be ineffective.
What to expect now
The front does not close here. In March 2026, the USTR opened two Section 301 investigations: the one on forced labor, and a second, still open, into the alleged structural overcapacity of 16 trading partners, including China, the European Union, Singapore, Switzerland, Norway, Indonesia, and Malaysia. A restrictive conclusion to that file would pave the way for a further tariff tier in the second half of the year.
For Italy, the exposure remains significant. According to Istat (the Italian national statistics office), Italian goods exports to the United States grew 7.2% in 2025, in sharp contrast with the drop of more than 9% for Germany and Spain and the 0.9% decline for France; the institute notes, however, that Italy’s exposure to non-EU markets was higher than that of the other large economies in the bloc, a factor that can represent a vulnerability. That same year, its trade surplus with the United States shrank from €38.9 billion ($42 billion) to €34.2 billion ($36.9 billion).
Editor’s note
This article was originally published in Italian on money.it by Flavia Provenzani on July 24, 2026 as «Dazi Usa, da oggi nuovi dazi del 10-12,5% su 60 Paesi. Cosa cambia per l’Italia e per l’UE». It has been translated and adapted for an international audience by the Money.it International desk.
