U.S. forced labor tariffs split 60 economies into 10% and 12.5% tiers based on each country's anti-forced labor laws. China faces the higher rate; the EU gets the lower one. Exemptions available for clean supply chains.
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The United States imposed forced labor tariffs on 60 economies Thursday, splitting the duties by how each country polices the practice internally.
Goods from nations the U.S. deems to have adequate anti-forced labor laws will face a 10% tariff. Imports from countries with weaker bans will be levied at 12.5%. The White House said the policy is tied to a new enforcement framework under the Uyghur Forced Labor Prevention Act.
The 10% rate applies to economies including the European Union, Japan, and South Korea, according to a trade official familiar with the list. The higher 12.5% duty covers countries such as China, Vietnam, and Bangladesh, the official said. The administration will review each country's classification annually.
Companies that can prove their supply chains are free of forced labor can apply for exemptions, the official added. The exemption process mirrors the existing mechanism for goods from China's Xinjiang region, which the UFLPA already targets.
The tariff structure is designed to reward governments that strengthen their own enforcement, a senior trade adviser told reporters. "If you pass a law that meets the standard, your goods face the lower rate," the adviser said.
Business groups had pushed for a single low rate across all countries, arguing that a two-tier system would complicate customs compliance. The National Association of Manufacturers said the policy could raise costs for electronics and apparel importers who source from multiple countries with different classifications.
China's commerce ministry called the tariffs "unjustified coercion" and said it would challenge them at the World Trade Organization. Vietnam's trade ministry said it was reviewing the classification criteria.
The tariffs take effect Aug. 1. Customs and Border Protection will begin collecting the duties on imports entering after that date, regardless of when contracts were signed.
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