The United States announced that it would impose a 25 per cent tariff on most imports from Brazil as of 22 July. This measure is based on section 301 of the Trade Act 1974 and represents a further escalation of the trade dispute between the United States and Pakistan, which lasted for one year.
The United States lists the reasons for taxing.
According to the United States Trade Representative Office, the investigation found that there were many “unfair trade practices” in Brazil. Among the reasons cited by the United States are the demand for the US Science and Technology Platform to remove some of its political content and suspend United States resident accounts, the granting of more favourable tariffs to Mexico and India, inadequate enforcement of intellectual property rights and barriers to ethanol markets.
Effective 22 July
Under United States arrangements, new tariffs will be formally implemented next week, covering most Brazilian commodities, but excluding some of them.
- Exempted goods include beef
- It also includes orange juice, aircraft and spare parts.
- Energy products are not taxed in the current round. Internal
The Brazilian Ministry of Trade has not responded immediately to the reports.
Another investigation or re-encumbrance 12.5%
Prior to this round of measures, the United States Supreme Court, in February of this year, overthrew the Trump government’s earlier practice of imposing 50 per cent tariffs on Brazilian goods, retaining only 10 per cent of global tariffs. Since then, the Trump Government has turned to the launching of 301 investigations in an attempt to re-energize tariff measures for specific countries without additional authorization from Congress.
According to the United States Trade Representative Office, the new tariff was intended to create a more level playing field for United States workers and enterprises. The United States Secretary of State, Rubio X, wrote that President Lula of Brazil had failed to negotiate in good faith and blamed the failure to reach an agreement on customs decisions.
In addition to the current 25 per cent tariff, the United States is promoting a separate investigation related to forced labour enforcement. If the results of the survey support a tax increase, Brazilian commodities may be raised by 12.5 per cent over existing tariffs, and the decision is expected to come out next week.
The dispute affected the Brazilian elections.
The dispute has also spilled over to Brazilian politics. Brazil will hold presidential elections in October. Last month Lula stated that Brazil would not accept the relevant treatment offered by the United States. He then accused Senator Flavio Bossonaro of promoting tariff pressure during his visit to the United States, but the latter denied this claim and stated that he wished to persuade the Trump government to postpone the implementation of the tariff until after the elections.