New US Tariffs under section 301: action against forced labor
New US Tariffs under section 301: action against forced labor
By Lorenzo Ontano, Giuseppe Falduto
Starting on July 24, the United States of America has definitively adopted new customs tariffs under Section 301 of the Trade Act of 1974, targeting 60 economies deemed non-compliant in imposing and enforcing an effective ban on the importation of goods produced with forced labor.
The investigations by the US authorities, initiated on March 12, 2026, formally determined that the practices of the 60 economies under investigation, including the European Union, are unreasonable and burden US trade, and are therefore actionable under Section 301(b).
In the light of the above, starting from July 24, the following tariffs will apply to imports into the USA, structured on three levels:
- 10% for economies that have adopted a ban on the import of forced labor products, that have made commitments through a Reciprocal Trade Agreement, or that have introduced a partial regime. These include: Argentina, Bangladesh, Canada, India, Indonesia, Mexico, Pakistan, Malaysia, and the United Kingdom;
- 10% or 12.5% (net of the Most-Favored-Nation tariff) for certain products originating from the European Union, Taiwan, Japan, Korea, and Switzerland that are not otherwise exempted;
- 12.5% for all other economies under investigation.
Exemptions are provided for: (a) raw materials whose taxation could cause a shortage of domestic supply; (b) products that could generate systemic economic disruptions; (c) goods that cannot be produced in sufficient quantities in the USA nor sourced from alternative sources; (d) certain products from economies that commit to adopting effective bans; and (e) items for which the tariffs would not substantially contribute to eliminating the contested practices.
Companies with supply chains involving the affected economies are advised to promptly verify the customs classification and origin of their goods and the potential applicability of exemptions.
For the sake of completeness, we highlight Donald Trump’s informal announcement of possible tariffs of 100%, and subsequently 200%, on generic drugs imported into the United States. The measure would affect companies that do not relocate production to the USA and, as announced, would take effect gradually starting in August 2028. This is a development to monitor, given its possible impact on the sector and on generic drug prices.
Francesco Pizzo
Dal 2003 Francesco assiste società multinazionali in materia di imposte indirette nazionali e internazionali. È specializzato in IVA, dazi doganali, accise e imposte ambientali. Assiste i clienti durante le verifiche e i contenziosi in materia di imposte indirette.
Lorenzo Ontano
