Trump’s New 10% Global Tariffs Take Effect; White House Prepares 15% Hike Next

US President Donald Trump's new global tariffs came into effect at 10% on Tuesday after the Supreme Court struck down previous duties last Friday. Trump signed an executive order authorising the 10% duties just hours after the ruling.

The next day he threatened to subsequently raise the rate to 15%. However, the White House did not issue any official executive order till the time 10% tariff rate came into effect on Tuesday at 12 AM Washington time.

Meanwhile, the Trump administration is preparing a formal directive to raise the global tariff rate to 15%. An official informed Bloomberg that the timeline for introducing the higher duty has yet to be settled.

The administration is invoking Section 122 of the Trade Act of 1974, a provision that permits the president to impose such duties for up to 150 days without needing approval from Congress.

The order preserved some exemptions, including for goods compliant with the North American trade pact between the US, Canada and Mexico as well as an exception for some agricultural goods that existed under Trump's invalidated levies.

The president has maintained that higher tariffs are required to narrow the country's trade deficit — the gap by which imports outstrip exports. Yet the deficit climbed to a new peak last week, expanding by 2.1% from 2024 to reach an estimated $1.2trn.

According to the latest available figures, the US has already taken in more than $130bn in tariffs through the International Emergency Economic Powers Act (IEEPA).

Trump warned countries that if they back out of recently concluded trade deals after the court ruling, he would impose higher duties under different trade laws.

He added that despite the court's decision to invalidate his tariffs under the IEEPA, its decision affirmed his ability to use tariffs under other legal authorities "in a much more powerful and obnoxious way, with legal certainty, than the Tariffs as initially used".

Meanwhile, the EU is delaying ratification of its own trade deal with the US in response to the 15% plan.

India in the Picture

For India, the ruling lifts an important source of uncertainty around potential tariff increases and re-establishes a more even playing field compared with the earlier system of reciprocal duties.

Before the ruling, exporters from India were exposed to combined tariff burdens of as much as 50% in some sectors, while reciprocal duties under interim measures stood at 18%. With those reciprocal tariffs now struck down, many Indian shipments to the US would have reverted to standard Most Favoured Nation rates.