Chips, drugs, and steel — how to prepare for Trump tariffs

Last updated on November 3, 2025, at 10:30 a.m. ET. We’re updating this blog post as new information becomes available. Avalara Cross-Border can help your business adapt to the changing dynamics of cross-border duties and tariffs. Contact us to get started.

Tariff and trade policy changes continue to keep businesses on their toes. In October alone, U.S.-China relations shifted from tense to tentatively positive, while U.S.-Canada relations became more strained. 

Here’s what’s happening.

• The White House will lower the China tariffs by 10% effective November 10, 2025, maintain its suspension of heightened reciprocal tariffs on Chinese imports until November 10, 2026, and extend the expiration of certain Section 301 tariff exclusions until November 10, 2026.

• In late October 2025, President Trump said he would increase the tariff on Canada by 10%. There was no official guidance on this policy as of November 1, 2025.

• A federal appeals court determined on August 29, 2025, that the International Emergency Economic Powers Act (IEEPA) does not grant the president the authority to establish tariffs. The U.S. Supreme Court will decide the fate of the IEEPA tariffs in early November.

• The U.S. exempted certain critical minerals and other products from reciprocal tariffs effective September 8, 2025. Certain previously exempt products, such as crystals and resins, became subject to applicable reciprocal tariffs as of that date.

• The U.S. ended the de minimis exemption for China and Hong Kong on May 2, 2025, and for all other countries effective August 29, 2025. Postal operators worldwide have suspended shipments of low-value goods to the U.S. until they're able to comply with the new requirements.

• Most Chinese products are subject to 30% IEEPA tariffs, plus the tariffs that were in effect prior to 2025. Certain products are subject to product-specific tariffs or are duty-free.

• Canadian and Mexican products that qualify for preferential treatment under the United States-Mexico-Canada Agreement (USMCA) are duty free. Country-specific tariffs (35% for Canada, 25% for Mexico) apply to most products that aren’t USMCA-certified. Certain products are subject to product-specific tariffs (e.g., 10% for energy and potash from both countries; 50% for steel from both countries).

• Canada removed all Canadian tariffs on USMCA-compliant U.S. goods as of September 1, 2025. However, Canada is retaining its tariffs on steel and aluminum for now. 

• The U.S. imposed new reciprocal tariffs on most countries effective August 7 and increased the reciprocal tariff on India on August 27. Countries that buy oil or gas from Venezuela are subject to a 25% tariff. 

• The U.S. imposes higher tariffs on select products, including automobiles, steel and upholstered wooden furniture. Consumer electronics are exempt from most reciprocal tariffs.

• U.S. Customs and Border Protection (CBP) has increased enforcement activity. 

To fully understand the latest tariff policy changes, you need to know how we got to this point. Read on for a recap of the 2025 trade war to date, or jump down to learn how businesses can manage tariff changes.

Our tariff timeline starts with the most recent events and works back.

On November 1, the White House published a fact sheet on the trade deal with China. It states that the U.S. will:

• Lower the fentanyl tariff on China by 10% effective November 10, 2025.
• Maintain its suspension of heightened reciprocal tariffs on Chinese imports until November 10, 2026; the current 10% reciprocal tariff will remain in effect.
• Extend the expiration of certain Section 301 tariff exclusions until November 10, 2026; these tariffs were due to expire on November 29, 2025.

See the fact sheet for additional information.

On October 30, the U.S. and China reached a verbal agreement during trade talks in South Korea. Beijing will reportedly suspend restrictions on rare earth exports, and Washington will reportedly lower the fentanyl tariff from 20% to 10%. Both countries also agreed to suspend their new port fees on each other’s ships. 

On October 14, the U.S. implemented new port fees on certain Chinese-built vessels and vessels with Chinese owners or operators. 

On October 10, trade tensions between the U.S. and China escalated. China announced new port fees on U.S.-owned vessels as well as new export restrictions on rare earth minerals. President Trump announced a 100% tariff on China, over and above any existing tariffs, and export controls on all critical software. According to his social media post, these new policies will take effect November 1, 2025.

On October 6, President Trump announced via social media that all medium- and heavy-duty trucks entering the U.S. from other countries will be subject to a 25% tariff starting November 1, 2025.

On September 29, the White House published a fact sheet and proclamation adjusting duties on imports of timber, lumber, and their derivative products. They invoke Section 232 to establish the following tariffs, effective October 14, 2025:

• A 10% tariff on softwood timber and lumber  

• A 25% tariff on certain upholstered wooden products, to increase to 30% on January 1, 2026

• A 25% tariff on kitchen cabinets and vanities (and parts), to increase to 50% on January 1, 2026

Countries that reach a pertinent trade agreement with the U.S. may be able to avoid the scheduled tariff hikes.

The tariffs imposed in this proclamation are in addition to any other applicable charges, duties, exactions, fees, and taxes — with certain exceptions.

Exceptions

For the U.K., the Section 232 tariffs on wood products shall not exceed 10%. For the European Union and Japan, the combined Section 232 wood products tariff and most-favored nation tariff on wood imports shall not exceed15%.

The new wood products tariff does not apply to imports that are subject to Section 232 tariffs on auto and auto parts. However, goods that are subject to the new Section 232 wood products tariff are not subject to reciprocal tariffs, the 40% Brazil tariff, or the 25% tariff imposed on India for trading in oil with Russia; only the wood products tariff applies.  

Canadian and Mexican wood products that would otherwise be subject to both the new Section 232 tariffs and existing IEEPA tariffs are only subject to the new Section 232 timber and lumber tariffs; the IEEPA tariffs do not apply; and the Section 232 tariffs apply even if the products are USMCA compliant.

On September 25, President Trump announced the following new tariffs via his social media platform:

• A 100% tariff on pharmaceuticals (branded or patented drugs); does not apply to companies that are building or expanding drug manufacturing facilities in the U.S.
• A 50% tariff on bathroom and kitchen cabinets
• A 30% tariff on upholstered furniture
• A 25% tariff on heavy-duty trucks

The president’s post said these tariffs will take effect October 1, 2025, but as of September 29, no official guidance has been provided. It’s not known whether these tariffs will be stackable, or how existing trade deals will apply.  

On September 9, the Supreme Court of the United States agreed to hear the IEEPA case; it will hold oral arguments in early November.

On September 5, the president signed an executive order modifying the scope of reciprocal tariffs and establishing a framework to implement tariffs with certain U.S. trading partners. 

Annex I, which is included in the executive order, lists 39 HTSUS codes that are exempt from reciprocal tariffs as of September 8, 2025, and eight HTSUS codes that are subject to reciprocal tariffs as of September 8. The codes have been added to an updated Annex II.

Annex III, which starts on page 38 of Annex II, provides a list of “potential tariff adjustments for aligned partners.” These are the imports for which the president “may be willing to provide a zero percent reciprocal tariff rate.”

On September 4, President Trump officially implemented the United States-Japan Agreement first announced back in July. The agreement sets a baseline 15% tariff on nearly all Japanese imports, retroactive to August 7, 2025. However, there are “separate sector-specific tariffs” — a 0% additional rate of duty — for steel and aluminum, copper, certain aerospace products, generic pharmaceuticals, generic pharmaceutical ingredients, and unavailable natural resources.

On August 29, a federal appeals court ruled that IEEPA’s grant of presidential authority to “regulate” imports does not authorize the president to impose tariffs. Yet the court is allowing the IEEPA tariffs to remain in place through October 14, 2025, to give the parties time to ask the Supreme Court of the United States to hear the case.

On August 22, Canada announced the removal of all Canadian tariffs on U.S. goods covered under the USMCA, or CUSMA as it’s known in Canada, effective September 1, 2025. Canada’s tariffs on steel, aluminum, and automobiles will remain in effect until further notice.

In other news, postal operators worldwide are suspending certain shipments to the U.S. due to the elimination of the de minimis exemption. Additional details can be found here.

On August 11, the White House suspended a tariff increase that was set to hit Chinese imports on August 12. Products of China, Hong Kong, and Macau remain subject to a 10% reciprocal tariff during the suspension period, plus the 20% tariff established earlier this year under the International Emergency Economic Powers Act (IEEPA), plus other applicable U.S. tariffs.

On August 6, President Trump issued an executive order raising India’s tariff by 25%, effective “21 days after the date of this order,” or August 27, 2025, at 12:01 a.m. ET. The extra duty will stack on top of the 25% duty that took effect August 7. Goods in transit arriving before September 17 are exempt from the additional duty

The additional 25% tariff does not apply to the articles listed in Annex II of Executive Order 14257.  

On July 31, President Trump extended for 90 days the current tariffs on Mexico: 25% on goods that don’t qualify for USMCA, 25% on cars, and 50% on steel, aluminum, and copper.

The White House also published a list of updated reciprocal tariff rates for a host of countries. Any countries not on the list remain subject to a 10% tariff. The new rates take effect seven days from the date of the announcement, or August 7, 2025, at 12:01 a.m. ET. 

On July 30, the White House suspended duty-free de minimis treatment for low-value shipments effective August 29, 2025, at 12:01 a.m. ET.

President Trump also issued a proclamation officially setting a 50% tariff on copper imports as of August 1, and an executive order imposing a 50% tariff on Brazil. Many key Brazilian products, including orange juice, will remain exempt.

Via Truth Social, the president said India would be subject to a 25% tariff starting August 1 — lower than the 26% previously announced but higher than expected.

On July 27, the EU and U.S. reached a trade deal that sets a 15% tariff on “the vast majority” of European goods, including cars, pharmaceuticals, and semiconductors. Per a statement issued by European Commission President von der Leyen, “This 15% is a clear ceiling. No stacking. All-inclusive.”

President Trump and President von der Leyen also agreed on “zero-for-zero tariffs on a number of strategic products” including aircraft and component parts, certain chemicals, certain generics, semiconductor equipment, certain agricultural products, natural resources, and critical raw materials. 

The reaction in Europe was mixed.

On July 23, Trump announced a trade deal with Japan. According to his Truth Social post, the tariff on Japan will jump to 15% instead of 25% on August 1. Official guidance has yet to be released.

Also on July 23, the European Commission threatened to impose a 30% tariff on nearly €100 billion worth of U.S. imports if no trade deal is reached.

On July 22, the White House published the framework for a reciprocal trade deal with Indonesia. It sets a 19% tariff on Indonesian products effective August 1, 2025. The U.S. also announced a trade deal with the Philippines.

On July 9, Trump announced via Truth Social that Brazilian imports will be subject to a 50% tariff starting August 1, 2025. Brazil is currently subject to a baseline 10% reciprocal tariff, and it was not on the list of countries whose rate was scheduled to increase July 7 (until it was pushed back to August 1).

Trump also said he may add an additional 10% tariff to all BRICS countries (Brazil, Russia, India, China, and South Africa, plus Egypt, Ethiopia, Indonesia, Iran, and Saudi Arabia).

And the president announced via Truth Social that the U.S. would impose a 50% tariff on copper starting August 1, 2025.

On July 8, the president threatened tariffs of up to 200% on pharmaceutical imports, but suggested they would not take effect until “about a year, year and a half.”

On July 7, President Trump extended the 10% reciprocal tariffs that were set to expire for most countries on July 9, 2025. The 10% tariffs will remain in effect until 12:01 a.m. ET on August 1, 2025, at which point tariffs on most countries will increase. 

Over the next few days, Trump posted a series of letters on social media changing the reciprocal tariffs on Algeria, Bangladesh, Bosnia-Herzegovina, Brunei, Cambodia, Indonesia, Iraq, Japan, Kazakhstan, Laos, Libya, Malaysia, Moldova, Myanmar, Philippines, Serbia, South Africa, South Korea, Sri Lanka, Thailand, Tunisia, and the European Union.

The Trump tariff letters specify that the reciprocal tariff is separate from all sectoral tariffs and that goods transshipped to evade a higher tariff will be subject to that higher tariff.

Trump also announced that on August 1, 2025, the tariff on Canada will increase from 25% to 35% and the tariff on Mexico will increase from 25% to 30%. USMCA-compliant goods remain exempt, and energy and potash will continue to be subject to a 10% tariff.

Read more about the reciprocal tariffs set to come into force on August 1, 2025.

On July 4, the president signed the One Big Beautiful Bill Act into law. Section 70531 of the bill eliminates the de minimis exemption for all commercial shipments effective July 1, 2027.

On June 16, the White House officially announced the terms of its trade deal with the United Kingdom. It sets a 10% tariff on most goods, including the first 100,000 vehicles, and a 25% tariff on steel and aluminum.

On June 10, the U.S. Court of Appeals for the Federal Circuit extended the temporary stay issued May 29. It will hold oral arguments for this matter on July 31, 2025, at 10:00 a.m. ET unless the parties request an alternative date.

On June 3, Trump raised the steel and aluminum tariffs from 25% to 50%, effective 12:01 a.m. ET on June 4, 2025.

On May 29, the U.S. Court of Appeals for the Federal Circuit temporarily stayed the injunction set by the Court of International Trade. The appeals court directed the plaintiffs and the appellees to respond to the United States motions for a stay no later than June 5, 2025.

On May 28, the U.S. Court of International Trade blocked tariffs implemented under the International Emergency Economic Powers Act (IEEPA). The court ruled that the IEEPA does not grant President Trump the power to impose unlimited tariffs on goods from nearly every country.  

The court gave the White House 10 days to halt affected tariffs, which include the tariffs on Canada, Mexico, and China, the reciprocal tariffs on other countries (currently 10%), and the 25% tariff on countries that import Venezuelan oil. The ruling does not affect Section 232 tariffs on automobiles and car parts, steel, or aluminum.

On May 12, President Trump lowered the reciprocal tariff on China, Hong Kong, and Macau from 125% to 10% for a period of 90 days, starting at 12:01 a.m. ET on May 14, 2025. This 10% tariff stacks on top of the 20% fentanyl tariffs. 

On May 2, the U.S. eliminated the de minimis exemption for products of China and Hong Kong valued $800 or less effective May 2, 2025, at 12:01 a.m. ET. Chinese imports must be assigned the appropriate Harmonized Tariff System (HTS) code and rate of duty. CBP will reject affected products filed without the required additional duties. 

CBP says it “will take enforcement action on patterns of noncompliance.” Read more about U.S.-China tariffs and the end of de minimis. 

On April 15, the White House noted that tariffs for some products of China can be as high as 245%.

On April 13, the European Commission said it would pause its planned retaliatory tariffs for up to 90 days. The EU’s planned countermeasures, which were set to start April 15, include phasing in 25% tariffs on a host of products.

On April 11, the White House announced exceptions to the reciprocal tariffs on China. Affected products include electronics such as computers, semiconductors, and smartphones.

On April 9 at around 2:00 p.m. ET, President Trump paused most of the reciprocal tariffs that went into effect at 12:01 a.m. ET. The 90-day pause applies to all countries subject to reciprocal tariffs, except China. 

The president also increased the reciprocal tariff on China to 125%. The 125% duty is in addition to the other China tariffs.

On April 8, President Trump increased the reciprocal tariff on China from 34% to 84%, effective 12:01 a.m. ET on April 9.

On April 2, aka Liberation Day, President Trump took to the Rose Garden to announce reciprocal tariffs on a host of countries:

• A 10% baseline tariff on virtually all imports effective April 5, 2025, at 12:01 a.m. ET; this doesn’t apply to Canada or Mexico
• Higher reciprocal tariffs on many countries effective April 9, 2025, at 12:01 a.m. ET

Though not mentioned during the Rose Garden speech, the White House is also ending duty-free de minimis treatment for low-value imports from China and Hong Kong starting May 2, 2025, at 12:01 a.m. ET. 

Goods not subject to the reciprocal tariffs include:

• Articles subject to 50 USC 1702(b)
• Steel/aluminum articles, and autos/auto parts already subject to Section 232 tariffs
• Copper, pharmaceuticals, semiconductors, and lumber articles
• All articles that may become subject to future Section 232 tariffs
• Bullion
• Energy and certain minerals that are not available in the United States

The “existing fentanyl/migration” tariffs on Canada and Mexico remain in effect and are unaffected. “This means USMCA compliant goods will continue to see a 0% tariff, non-USMCA compliant goods will see a 25% tariff, and non-USMCA compliant energy and potash will see a 10% tariff.”

Should the existing fentanyl/migration tariffs be terminated, “USMCA compliant goods would continue to receive preferential treatment, while non-USMCA compliant goods would be subject to a 12% reciprocal tariff.”

The president emphasized that foreign companies can avoid the tariffs by manufacturing their products in the U.S. There’s more information in the April 2 executive order.

On March 26, President Trump invoked Section 232 to implement “a 25% tariff on all cars that are not made in the United States” starting April 3, 2025.

On March 24, President Trump signed an executive order imposing tariffs on countries that import Venezuelan oil, invoking the IEEPA. On or after April 2, 2025, a 25% tariff “may be imposed on all goods imported into the United States from any country that imports Venezuelan oil, whether directly from Venezuela or indirectly through third parties.” This 25% duty would be in addition to any existing duties.

The secretary of state is authorized to determine whether the 25% tariff will be imposed on goods from any country that directly or indirectly imports Venezuelan oil. If implemented, the tariffs will lapse one year after a country ceases importing Venezuelan oil — or sooner if officials deem it appropriate. This White House fact sheet offers more details.

On March 19, the European Commission said it would delay the first round of its retaliatory tariffs to allow time for “negotiations to try to find a mutually agreeable resolution.”

On March 13, President Trump threatened to put a 200% tariff on all wine, beer, and spirits imported from the European Union.

On March 12, the United States implemented a 25% tariff on steel and aluminum imports, as promised.

However, the U.S. and Canada stepped back from additional escalating tariffs. Ontario Premier Doug Ford did not implement a promised 25% tariff on electricity exports to Michigan, Minnesota, and New York. The U.S. did not implement the extra 25% tariff on steel and aluminum that President Trump had threatened. 

On March 11, the European Commission said it would respond to new U.S. tariffs on steel and aluminum by reestablishing tariffs that had been adopted then suspended during the first Trump administration. The first round of tariffs would come into effect on April 1 and include 50% tariffs on U.S. bourbon and whiskey; additional tariffs would take effect on April 13.

On March 6, Trump said he was pausing the tariffs for Mexican products covered under the USMCA. “After speaking with President Claudia Sheinbaum of Mexico, I have agreed that Mexico will not be required to pay Tariffs on anything that falls under the USMCA Agreement,” Trump wrote on Truth Social. “This Agreement is until April 2nd.”

In response, Sheinbaum decided not to move forward with retaliatory tariffs.

Later that day, the president provided the same exemptions for Canadian goods covered under USMCA. According to a White House official, the exemptions apply to approximately 50% of Mexican imports and 38% of Canadian imports.

Two separate executive orders (Mexico and Canada) list 12:01 a.m. ET, March 7, 2025, as the effective date of the new exemptions.

On March 5, President Trump paused the tariffs on automobiles from Canada and Mexico after meeting with the big three auto dealers (Stellantis, Ford, and General Motors). “There is a one-month exemption on any autos coming through USMCA,” White House Press Secretary Karoline Leavitt said when breaking the news.

On March 4, Canada and China responded with retaliatory tariffs on U.S. goods. 

Canada implemented 25% retaliatory tariffs on $30 billion CAD worth of American goods at 12:01 a.m. ET on March 4. Another $125 billion CAD worth of American products would become subject to Canada’s 25% tariffs “in 21 days’ time.”

China announced 10% and 15% tariffs on roughly $21 billion worth of U.S. agricultural products. Goods subject to the 10% tariff include beef, dairy products, fruit, pork, seafood, sorghum, soybeans, and vegetables; the 15% tariff will affect products such as chicken, corn, cotton, and wheat. These tariffs took effect March 10.

Mexico’s President Claudia Sheinbaum said Mexico would announce retaliatory tariffs on U.S. goods on March 9.

On March 3, President Trump issued an amendment to the China tariffs. In this executive order, he communicates that the People’s Republic of China has not taken adequate steps to alleviate the illicit drug crisis. Instead of 10% tariffs, the U.S. will impose a 20% tariff on imports of products made in or shipped from China. No additional details, like an effective date, were provided.

CBP also released unofficial guidance clarifying that the additional duties on imports from Canada and Mexico would take effect at 12:01 a.m. ET on March 4, 2025.

On March 2, President Trump issued two separate executive orders regarding de minimis exemptions for Canada and Mexico, which were scheduled to be eliminated effective March 4, 2025. For now, the de minimis exemptions for Canada and Mexico remain in effect.

On February 27, the president announced via Truth Social that “the proposed tariffs scheduled to go into effect on March 4 will, indeed, go into effect as scheduled.” He added, “China will likewise be charged an additional 10% tariff on that date.”

Members of the administration indicated that the April date mentioned by President Trump on February 26 referred to reciprocal tariffs, not the 25% Canada and Mexico tariffs. White House economic advisor Kevin Hassett reportedly said Trump would make a final decision on tariff policies for all countries, including Canada and Mexico, after April 1, when a study on tariffs will be released.

On February 26, President Trump told the press he was not stopping the tariffs on Canada and Mexico. He said the tariffs would take effect April 2, 2025, “not all of them but a lot of them.”

On February 25, CBP announced that it will “reject entry summaries that are not in compliance with the requirements” set forth in the February 1 executive order, which imposed new duties on China. 

On February 13, President Trump signed a presidential memorandum ordering his administration to pursue reciprocal tariffs on U.S. trading partners.  

On February 10, President Trump announced a 25% ad valorem tariff on steel and aluminum articles from most countries effective March 12, 2025. 

On February 5, duty-free de minimis treatment was reinstated for products of China until CBP could put “adequate systems” in place “to fully and expediently process and collect tariff revenue” on articles “otherwise eligible for de minimis treatment.”

On February 4, the 10% China tariff took effect and the de minimis exemption for China ended.

On February 3, the president delayed the effective date of the Canada and Mexico tariffs to March 4, 2025.

On February 1, President Trump invoked the IEEPA to impose a 10% tariff on China, a 25% tariff on Canada, and a 25% tariff on Mexico effective February 4, 2025. His executive orders also end the duty-free de minimis treatment for articles of China, Canada, and Mexico.

On January 31, White House Press Secretary Karoline Leavitt confirmed that President Trump would implement new 25% tariffs on Canada and Mexico and a 10% tariff on China starting February 1, 2025.

Keeping track of changing tariff requirements and being prepared to implement — and undo — them on a dime is challenging for businesses. Fortunately, automating compliance can help.

Changing tariff policies challenge businesses that import affected goods into the United States. Companies exporting goods into countries with retaliatory tariffs on U.S. exports also face new hurdles.

Developing a proactive cross-border trade strategy and tax compliance plan is the best way for businesses to prepare for whatever new tariffs the future holds. While the current uncertainty over tariffs may be unsettling, businesses deal with changing tariffs all the time. In 2023 alone, there were 337 international rate updates and 6,779 international taxability updates.  

The key to handling all this change and streamlining international trade compliance is customs duty automation. 

Avalara Cross-Border connects all pieces of the global tax and tariff puzzle by delivering real-time calculation of customs duties and import taxes, and by automating tariff code classification. We stay on top of regulatory changes worldwide, so businesses don’t have to. It’s the ideal trade solution for online sellers seeking to establish a modular, best-of-breed platform to power their cross-border needs.

“The Avalara suite of compliance services can help you stay on top of this rapidly changing environment, giving you peace of mind that you are keeping pace with the changes,” says Craig Reed, General Manager of Cross-Border at Avalara. 

Let us help you stay ahead of change and continue to grow globally. Contact us today to learn more.

For more details about specific tariff changes, read:

• What are tariffs? How do they work?
• What you need to know about the US-Canada trade war
• How to handle U.S.-China tariffs and the end of de minimis
• The de minimis exemption is ending: Is your business ready?
• Trump steel and aluminum tariffs: What you need to know
• How new tariffs impact the beverage alcohol industry
• Reciprocal tariffs explained: Impact on your business
• The difference between IEEPA tariffs, Section 232 tariffs, and Section 301 tariffs

This post was first published on January 31, 2025.