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US President Donald Trump has raised the option of new “national security tariffs” after the United States Supreme Court last week overturned several of his previous tariffs.
According to sources close to the White House, the administration is working on new tariffs that could cover 5-6 sectors.
The new tariffs under consideration could cover large-scale batteries, cast iron and iron fittings, plastic piping systems, industrial chemicals, and electrical grid and telecommunications equipment. These tariffs are planned to be implemented under Section 232 of the 1962 Trade Expansion Act, which grants the president broad powers on national security grounds.
This move comes just days after the Supreme Court, by a 6-3 vote, overturned most of Trump’s “reciprocal tariffs”—issues he based on the International Emergency Economic Powers Act. The court ruled that Trump had exceeded his authority by imposing these tariffs on nearly all U.S. trading partners. The overturned tariffs accounted for more than half of the increased tariff revenue generated in his second term. To compensate for this loss, Trump last week announced a new 15% global tariff that will remain in effect for five months.
The new Section 232 tariffs will be implemented separately from the previously announced 15% global tariff and other tariffs planned under Section 301. Products under Section 232 have so far been exempt from other tariffs announced during Trump’s second term. Trump had also imposed tariffs under this section on steel, aluminum, copper, automobiles, trucks, and automobile parts during his second term. These tariffs were not affected by the Supreme Court ruling.
However, it is not yet clear when the new taxes under Section 232 will be formally subject to investigation and when they will ultimately come into effect. This section requires a thorough review process before the tax is implemented; however, once the customs duties are in effect, they can be unilaterally changed by the president.
White House spokeswoman Kush Desai said in a statement, “Protecting America’s national and economic security remains President Trump’s top priority. The administration is committed to using all lawful powers to achieve this.”
On the other hand, the Trump administration is reportedly considering tariffs under existing Chapter 232 investigations in nine different sectors, including semiconductors, pharmaceuticals, drones, industrial robots, and polysilicon used in solar panels. Some of these investigations were launched about a year ago, and it is stated that the process could be accelerated following the Supreme Court’s decision.
The administration is also preparing to change existing steel and aluminum tariffs. The planned adjustments could lower nominal tax rates; however, the aim is to apply taxes to the total value of the product, not just the value of the steel or aluminum within it. This could mean an increase in the final tax burden for many companies.
*This is not investment advice.
decrypt.co
coindesk.com
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