Dozens of countries will now face higher tariff rates on imports to the U.S. following the expiration of President Donald Trump’s Aug. 1 trade deal deadline.
President Trump signed an executive order late July 31 to implement new tariff rates for more than 60 countries, ranging from 10% to 41%. The new duties will take effect Aug. 8.
In April, President Donald Trump shared plans to impose reciprocal tariffs to match the rates that key trading partners levy on American imports. While the U.S. implemented a 10% baseline tariff on all countries, the administration delayed enforcement of reciprocal measures until Aug. 1 to allow time for negotiations.
A 50% tariff on steel and aluminum imports — which are key components in medical devices and surgical instruments — took effect June 4.
Here’s a look at where things stand with key trading partners and implications for the healthcare sector:
- On July 29, President Trump announced the U.S. had struck a trade deal with the European Union, the country’s largest trading partner. Under the deal, imports from 27-member countries will face a 15% baseline tariff rate, down from the 30% President Trump had previously threatened. The U.S. has imported $303.4 billion in goods from the E.U. so far this year, according to Census Bureau data compiled by CBS News.
The E.U. and the U.S. agreed to apply zero tariffs on certain generic drugs. Branded drugs, however, will face a 15% tariff, according to a fact sheet from the European Commission. Levies on pharmaceutical imports from the E.U. will be capped at that rate, should the Trump administration move forward with broader sector tariffs on drug imports.
- Europe is a major source of drug imports for the U.S., manufacturing 43% of active ingredients used in brand-name drugs. Added expenses from tariffs are expected to cost drugmakers billions, some of which will likely be passed on to employers, insurers and patients, according to The New York Times.
- Imports from India, which provide nearly half of generic drugs used in the U.S., will face a 25% tariff rate and goods from Japan will see a 15% rate, according to NBC News.
- The U.S. and Mexico have agreed to extend the deadline to reach an agreement by 90 days, pushing back baseline levies set to go into effect Aug. 1. However, a 25% tariff on steel and aluminum imports will remain.
- Tariffs on Canadian imports will jump from 25% to 35%, after the White House said Canada failed to take adequate steps to stop cross-border drug trafficking, according to CBS News. Canadian Prime Minister Mark Carney said his country was “disappointed” by the move and warned the tariffs could significantly affect industries, including steel and aluminum.
- The U.S. and China are continuing negotiations. While a formal deal was not reached by the Aug. 1 deadline, the White House is expected to extend China’s deadline by 90 days. Chinese goods remain subject to a 10% baseline tariff.
- Uncertainty remains surrounding sector-specific tariffs for pharmaceutical imports, which President Trump has threatened could reach 200%. Drugmakers would be given a grace period of up to 18 months to adapt, should those tariff rates materialize, President Trump said during a Cabinet meeting in early July, according to The Hill.
