In a significant move, US President Donald Trump is considering the introduction of new “national security tariffs” following a recent ruling from the Supreme Court that overturned several existing tariffs. This development comes as the administration seeks to address revenue losses resulting from the court”s decision.
Sources close to the White House indicate that the proposed tariffs could target five to six key sectors, which may include large-scale batteries, cast iron and iron fittings, plastic piping systems, industrial chemicals, as well as electrical grid and telecommunications equipment. These new tariffs would be enacted under Section 232 of the Trade Expansion Act of 1962, which provides the president with broad authority to impose tariffs for national security reasons.
The Supreme Court”s ruling, delivered by a 6-3 vote, concluded that Trump had overstepped his legal authority by applying tariffs through the International Emergency Economic Powers Act. The decision nullified many of his “reciprocal tariffs,” which represented a substantial portion of the tariff revenue generated during his presidency. In response to this setback, Trump recently announced a temporary 15% global tariff that would be in place for five months.
These forthcoming Section 232 tariffs will be distinct from the previously imposed 15% global tariff and other tariffs established under Section 301. Historically, products under Section 232 have been exempt from the various tariffs enacted during Trump”s second term, which included those on steel, aluminum, copper, automobiles, and automobile parts. Notably, these specific tariffs were not impacted by the Supreme Court”s ruling.
While the timeline for the implementation of the new tariffs remains unclear, it is important to note that Section 232 requires a comprehensive review process before any tariffs can take effect. However, once established, the president has the authority to modify these customs duties unilaterally.
White House spokeswoman Kush Desai emphasized, “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.”
Additionally, there are discussions within the Trump administration regarding tariffs based on ongoing Chapter 232 investigations across nine different sectors, which include semiconductors, pharmaceuticals, drones, industrial robots, and polysilicon used in solar panels. Some of these investigations were initiated approximately a year ago, and there are indications that their progress may be expedited in light of the Supreme Court”s recent decision.
The administration is also preparing to revise existing tariffs on steel and aluminum, which could entail reducing nominal tax rates. However, the intention appears to be to apply tariffs to the total value of the product rather than solely the value of the steel or aluminum components, potentially increasing the overall tax burden for many companies.
