What Are the “Trump Tariffs”? Background, Key Measures, and What They Mean for Taiwan’s Exporters

Table of Contents

A tariff is simply a tax placed on imported goods. It may look like a technical detail, but tariffs shape how global trade works and directly affect pricing and supply chains. In practice, tariffs are used to:

1. Protect local industries – Making imports more expensive so domestic products stay competitive.
2. Raise government revenue – Tariffs are a steady source of tax income.
3. Address trade imbalances – Limiting imports from certain countries or product categories.
4. Create leverage in negotiations – Tariffs can be used to pressure trade partners at the bargaining table.

The main types of tariffs you’ll see are:

• Ad Valorem – A percentage of the product’s value.
• Specific – A fixed fee per unit, weight, or quantity.
• Compound – A mix of both.

The term “Trump Tariffs” refers to a series of trade measures introduced by former U.S. President Donald Trump during his first term (2017–2021) and expanded after he returned to office in 2025.

What makes them stand out compared to traditional tariffs is their mix of broad coverage, targeted add-ons, and unilateral enforcement.

• Broad-based tariffs – A baseline tariff applied to almost all imported goods.
• Targeted tariffs – Extra duties aimed at specific countries or industries.
• Unilateral approach – Rolled out outside the WTO framework, based on U.S. laws and executive orders.

The legal backbone of these tariffs includes:

• Section 232 of the 1962 Trade Expansion Act (national security)
• Section 301 of the 1974 Trade Act (unfair trade practices)
• The International Emergency Economic Powers Act (IEEPA), expanded through presidential executive orders in 2025

Key measures under the Trump Tariffs:

1. 10% baseline tariff (the “Liberation Day Tariffs”) – Effective April 2, 2025, applied to nearly all imports.
2. Reciprocal tariffs – Country-specific duties tied to trade imbalances, generally in the 10%–50% range.

• Taiwan was initially set at 32%, later reduced to 20% (effective Aug 1, 2025).
• Other examples: Japan ~24%, Korea ~25%, Vietnam ~46%, EU ~20%.

Venezuela oil clause – Per a March 24, 2025 executive order, imports from countries that continue buying Venezuelan crude may face an additional 25% duty starting April 2, 2025.

The Trump administration’s tariff strategy was driven by four main goals:

1. Fixing the trade deficit – Trump argued that America’s large, persistent trade gap—especially with China—was the result of unfair practices. Tariffs were meant to pressure trading partners into more balanced terms.
2. Protecting U.S. manufacturing – He believed tariffs could shield industries like steel and autos from cheap imports and encourage production to return to the U.S.
3. Creating leverage at the table – Tariffs were used as a bargaining chip to push other countries, particularly China, to make concessions on intellectual property, tech transfer, and market access.
4. Delivering on “America First” – Above all, the tariffs reflected Trump’s America First agenda: putting U.S. economic interests ahead of global trade rules.

The most striking shift under the Trump Tariffs has been a move toward unilateral action, challenging the WTO’s long-standing role as the referee of global trade. The ripple effects touch almost every layer of international business:

Impact on global supply chains

• Supply chain realignment – To sidestep steep tariffs, many multinationals began relocating production from China to countries like Vietnam, Thailand, Mexico, and Taiwan. This accelerated the broader “China-plus-one” or de-coupling trend.
• Higher costs – With added duties, companies face higher sourcing costs. Much of that gets passed along to end customers, driving up prices.

Impact on trade relations

• Rising tensions – Tariffs have triggered retaliation from major partners. For example, China imposed duties on U.S. farm exports, hitting American agriculture hard.
• WTO credibility under strain – Unilateral U.S. actions have weakened trust in the WTO’s ability to resolve disputes effectively.

Impact on Taiwan’s exporters

For Taiwan, the Trump Tariffs are more than just an economic policy—they’re a mix of trade, politics, and national security strategy. The challenges are clear:

• Policy uncertainty – Tariff rates and measures can shift quickly.
• Compliance pressure – Companies must manage rules of origin, HS codes, and customs paperwork with greater precision.
• Supply chain risk – Exporters need more flexibility and diversification to handle sudden changes.
• Opportunity window – With global buyers seeking non-China options, Taiwan’s strong reputation for quality and engineering creates openings to win more orders.

With the Trump Tariffs adding new layers of complexity, exporters need to handle customs with extra care to stay compliant and avoid costly disruptions. Here are five key areas to focus on:

1. Get origin right
   The most critical step is correctly determining country of origin under the “substantial transformation” rule. A product’s origin is where it undergoes its final meaningful change in character, use, or form. Simple repacking or minor assembly doesn’t qualify.
2. Keep paperwork consistent
   All customs documents—commercial invoice, packing list, bill of lading, and certificate of origin—must match exactly. Even small discrepancies can trigger delays or penalties.
3. Double-check HS codes
   The correct HS classification is the foundation of duty calculation. Since tariff rates can vary widely by product category, work with your customs broker or trade advisor to confirm your codes are current.
4. Build traceability into the supply chain
   Be ready to document every stage of production. A clear audit trail helps satisfy customs reviews and reduces compliance risk.
5. Use tariff exclusions where possible
   Under Section 301, the U.S. Trade Representative (USTR) periodically grants exclusions for certain products. Some of these have been extended through November 29, 2025. Companies that qualify can save significantly if they apply in time.

Note: The points above reflect general observations. For case-specific guidance, companies should consult a qualified U.S. trade attorney or customs professional.

Several additional measures have rolled out in the second half of 2025 that exporters should be aware of:

• Steel and aluminum – Effective June 4, 2025, Section 232 duties were raised from 25% (steel) and 10% (aluminum) to 50%. The U.K. remains at prior rates.
• Autos and parts – As of March 26, 2025, a 25% duty was imposed under Section 232.
• Wood and furniture – Starting September 2025, Section 232 tariffs were expanded to cover 10% on lumber and 25% on cabinets and furniture, with further hikes possible in 2026.
• De minimis rule – Since May 2, 2025, low-value shipments from China and Hong Kong are no longer eligible for the US$800 duty-free threshold.
  

The Trump Tariffs have reshaped the rules of global trade. For Taiwan’s export-driven industries, they represent both a challenge and an opportunity. Staying competitive in this environment requires more than just calculating duty rates—it demands strict compliance, smarter supply chain design, and continuous product upgrades.

Looking ahead, exporters will need real-time agility and a global perspective to navigate shifting trade dynamics. For sectors like fasteners, steel, and electronics, sustained innovation and stronger branding will be the keys to not just surviving—but moving forward with confidence—amid tariffs and trade barriers.

Note: This article reflects general industry perspectives. For case-specific legal guidance, companies should consult a qualified U.S. trade attorney.

1. White House – Presidential Proclamation on the Liberation Day Tariffs, April 2, 2025
   https://www.whitehouse.gov/briefing-room/statements-releases/2025/04/02/liberation-day-tariffs
2. White House – Adjustments to Reciprocal Tariffs (incl. Taiwan update), August 1, 2025
   https://www.whitehouse.gov/briefing-room/statements-releases/2025/08/01/reciprocal-tariffs-update
3. White House Executive Order – Venezuelan Petroleum Imports, March 24, 2025
   https://www.whitehouse.gov/briefing-room/presidential-actions/2025/03/24/executive-order-venezuela-oil
4. U.S. Department of Commerce – Fact Sheet: Steel and Aluminum Tariffs Increase (Section 232), June 3, 2025
   https://www.commerce.gov/news/fact-sheets/2025/06/steel-aluminum-232-tariff-increase
5. White House – Proclamation on Section 232 Tariffs for Automobiles and Automotive Parts, March 26, 2025
   https://www.whitehouse.gov/briefing-room/presidential-actions/2025/03/26/section-232-auto-parts
6. U.S. Trade Representative (USTR) – Section 301 Tariff Exclusions Extension (through Nov. 29, 2025), May 15, 2025
   https://ustr.gov/issue-areas/enforcement/section-301-investigations
7. Reuters – Taiwan Secures Temporary Tariff Reduction to 20% in U.S. Reciprocal Tariffs, August 1, 2025
   https://www.reuters.com/world/taiwan-tariff-reduction-2025-08-01
8. NPR – U.S. Ends $800 Duty-Free Rule for China and Hong Kong Shipments, May 2, 2025
   https://www.npr.org/2025/05/02/u-s-ends-de-minimis-china-hk
9. Financial Times – U.S. Expands Section 232 Tariffs to Wood and Furniture Imports, September 10, 2025
   https://www.ft.com/content/us-232-tariffs-wood-furniture-2025
10. CSIS – Understanding the Liberation Day Tariffs: A Shift in U.S. Trade Policy, April 15, 2025
    https://www.csis.org/analysis/liberation-day-tariffs

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