U.S. unveils new tariffs on 60 partners as Trump rebuilds trade agenda
New US tariffs of 10% to 12.5% took effect from July 24, 2026, on imports from 60 trading partners, including China, India, and the European Union
The tariffs were issued under Section 301 of the Trade Act of 1974, following investigations into countries' enforcement of prohibitions on forced-labour-made imports
The action replaced an expiring interim global tariff that the administration had relied on since its broader emergency-powers tariffs were invalidated by the courts earlier in 2026
Together, the 60 covered economies account for an estimated 99.4% of total US trade, making this one of the most sweeping tariff actions of the year
The move reflects a broader recalibration of US trade policy toward statutory authorities less vulnerable to judicial challenge
Comparing US Presidential Tariff Authorities: IEEPA, Section 301, and Section 122
US Presidents draw tariff power from several distinct statutes, each with different legal thresholds and durability. IEEPA (International Emergency Economic Powers Act, 1977) was used in 2025-26 for broad "emergency" tariffs but was ruled unconstitutional as a tariff tool by the Supreme Court in February 2026. Section 301 of the Trade Act, 1974 requires a specific investigation into an "unfair" foreign practice before tariffs can be imposed, while Section 122 of the same Act allows a short-term (up to 150 days), capped (up to 15%) surcharge to address balance-of-payments problems without any investigation.
Key Details
- IEEPA tariffs (2025-26 "reciprocal"/baseline tariffs) were struck down 6-3 by the US Supreme Court in February 2026 and terminated February 24, 2026
- Section 122 (balance-of-payments) tariffs: capped at 15%, valid for a maximum 150 days — used as a bridge measure until July 24, 2026
- Section 301 (unfair trade practices) tariffs: require a formal USTR investigation and findings, but are more resistant to legal challenge since Congress delegated this authority explicitly for trade-practice remedies
- Other historically used authorities include Section 232 of the Trade Expansion Act, 1962 (national-security tariffs, used separately for pharmaceuticals and steel/aluminium)
The July 24 tariffs on 60 partners mark the transition point where the administration's temporary Section 122 tariff expired and was replaced by the more litigation-resistant Section 301 forced-labour tariffs — a shift in legal strategy after the IEEPA setback.
WTO Most-Favoured-Nation (MFN) Principle and Unilateral Tariff Actions
The Most-Favoured-Nation principle under Article I of the General Agreement on Tariffs and Trade (GATT), 1994 requires WTO members to extend the same tariff treatment to all other members that they extend to their most-favoured trading partner — barring discriminatory, country-specific tariffs outside of agreed exceptions (such as free trade agreements or the Enabling Clause for developing countries). Unilateral, country-differentiated tariffs imposed outside a WTO dispute-settlement finding sit in tension with this principle, which is why such measures are typically challenged as inconsistent with WTO obligations, even though enforcement has weakened with the WTO Appellate Body's prolonged non-functioning.
Key Details
- GATT Article I:1 is the foundational MFN obligation of the multilateral trading system
- The Enabling Clause (1979) permits differential, more favourable treatment for developing countries — the reverse of the punitive differentiation seen in Section 301 actions
- The WTO Appellate Body has been non-functional since 2019 due to the US blocking judge appointments, limiting the practical recourse of affected members
- Section 301 unilateral tariffs have historically drawn WTO-inconsistency objections, most notably during the 2018-19 US-China tariff disputes
Applying differentiated 10-12.5% tariffs to 60 economies based on individual country findings, rather than a uniform global rate, is precisely the kind of selective treatment that sits uneasily with MFN, even as institutional weaknesses at the WTO limit formal recourse.
India-US Trade Relationship and Ongoing Bilateral Trade Agreement Talks
India and the US have been negotiating a bilateral trade agreement (BTA) aimed at expanding market access and reducing tariff and non-tariff barriers, running in parallel with the tariff actions of 2025-26. The forced-labour tariff adds friction to this relationship even as both sides continue talks, illustrating how trade remedy actions and negotiated agreements can proceed on separate, sometimes contradictory, tracks.
Key Details
- The US is India's largest single-country trading partner and the largest destination for Indian exports
- India-US trade negotiations in 2025-26 have covered agriculture market access, digital trade, and tariff rationalisation
- Additional Section 301 tariffs apply on top of, not instead of, existing MFN duties and any product-specific tariffs (such as those on steel, aluminium, or pharmaceuticals)
- India's trade policy response has combined regulatory compliance steps (such as the forced-labour import ban) with formal objections to specific tariff determinations
The 10-12.5% forced-labour tariff shows that even as India and the US negotiate a broader trade agreement, both countries continue to use unilateral trade-remedy tools, underscoring the layered and sometimes inconsistent nature of contemporary US trade policy.
- New tariff range: 10% to 12.5%, effective July 24, 2026
- Number of trading partners covered: 60, representing approximately 99.4% of US trade
- Legal basis: Section 301, Trade Act of 1974
- IEEPA tariffs struck down: February 20, 2026 (6-3 Supreme Court ruling); terminated February 24, 2026
- Interim Section 122 tariff cap: 15%, maximum duration 150 days
- WTO MFN principle: GATT Article I:1; WTO Appellate Body non-functional since 2019