In a major escalation of bilateral trade frictions, the United States has formally announced it will implement a 25% tariff on targeted imports from Brazil, capping a year-long investigation that concluded Brasilia engaged in multiple unfair trade practices. The new levies, which were first proposed to the public in early June, are scheduled to enter into force on July 22, according to official statements from Washington.
Not all Brazilian imports will face the new duties, however. Trade officials carved out exemptions for a select group of products that either have no domestic U.S. production alternative or whose inclusion would risk severe disruptions to critical domestic supply chains. Products granted exemption status include major Brazilian export staples such as coffee, beef, whole oranges and orange juice, alongside select oil and gas energy products and aerospace components.
The U.S. Trade Representative (USTR) office, which conducted the 12-month probe, released its final finding that Brazil has maintained a suite of unreasonable and unfair trade measures. Among the cited issues are lax anti-corruption enforcement and Brazil’s own asymmetric, unfair tariff schedules on imported goods. Notably, the announcement comes despite the U.S. having run a consistent goods trade surplus with Brazil for multiple years.
In an official statement following the announcement, USTR acting head Jamieson Greer framed the new tariffs as a necessary step to protect the competitive standing of American workers and businesses. “Extensive negotiations with Brazil over the past year have not resolved these issues, but we remain open to continuing negotiations with Brazil to bring about long-needed changes to the problems identified in this investigation,” Greer added, leaving the door open to a diplomatic resolution.
Brazilian President Luiz Inácio Lula da Silva reacted sharply to the early June proposal of the tariffs, dismissing the U.S.’s trade complaints as rooted in political rather than economic motives. Lula pointed directly to a recent high-profile visit to Washington by Brazilian Senator Flávio Bolsonaro, son of former Brazilian president Jair Bolsonaro – a close ally of U.S. President Donald Trump – as a key factor behind the action. Flávio Bolsonaro ran against Lula in Brazil’s October general election.
U.S. Secretary of State Marco Rubio made no attempt to soften the U.S.’s position in a public post on social platform X after the announcement. “Let there be no confusion about why: President Lula and his government have not negotiated with the US in good faith. His economic policies are bad for Americans and bad for Brazilians. For the past year, Lula has put his own ego ahead of making a deal for the welfare of the Brazilian people, and these tariffs are the price for that,” Rubio wrote.
The current round of tariffs is being imposed under Section 301 of the 1974 U.S. Trade Act, a longstanding legislative provision that grants the executive branch authority to launch investigations into unfair foreign trade practices and impose retaliatory measures. This action marks a shift from a previous tariff regime targeting Brazil that was struck down by the U.S. Supreme Court earlier this year.
In February, the Supreme Court ruled that Trump had overstepped his executive authority when he imposed sweeping 50% tariffs on Brazilian goods under the 1977 International Emergency Economic Powers Act (IEEPA). Those tariffs were originally put in place to protest Brazil’s ongoing prosecution of former President Jair Bolsonaro, who is facing charges for his role in efforts to overturn the result of the 2022 Brazilian presidential election, which he lost to Lula. Interestingly, relations between Trump and Lula appeared to show signs of warming just months ago, when Lula made a high-profile visit to the White House in May.