Trump: US to usher in ‘golden age’ with fresh tariffs
US president Donald Trump has sent out letters outlining new tariffs to be effective from 1 August.
In early April, Donald Trump invoked emergency economic powers to impose tariffs on almost every country in the world, with the goal of correcting the US goods trade deficit. The tariffs were swiftly paused for 90 days, from 9 April, after they tanked global sharemarkets and prompted international outcry.
On Tuesday, as the pause expiry deadline loomed, Trump signed an executive order to extend the pause to 1 August. He also announced fresh tariff rates on 12 countries, due to take effect from 1 August.
“Today’s Order, combined with letters sent to trading partners, underscores President Trump’s commitment to take back America’s economic sovereignty by addressing many nonreciprocal trade relationships that threaten our economic and national security,” the White House said in a statement.
The 90-day pause, which saw all tariffs fall to a baseline 10 per cent rate, offered a welcome reprieve to the global economy. However, the White House flagged that most countries could expect to see ‘reciprocal’ tariff rates similar to those announced on 2 April.
The first tranche of tariffs announced by the White House included:
- Japan (25 per cent)
- Korea (25 per cent)
- South Africa (30 per cent)
- Kazakhstan (25 per cent)
- Laos (40 per cent)
- Malaysia (25 per cent)
- Myanmar (40 per cent)
- Tunisia (25 per cent)
- Bosnia and Herzegovina (30 per cent)
- Indonesia (32 per cent)
- Bangladesh (35 per cent)
- Serbia (35 per cent)
- Cambodia (36 per cent)
- Thailand (36 per cent)
Tariff rates were largely similar to the original ‘liberation day’ rates, with some tweaks, such as Japan’s rate being 1 per cent higher and Cambodia’s being 13 per cent lower.
Australian prime minister Anthony Albanese flagged that he did not expect Australia’s 10 per cent baseline tariff rate to budge, despite ongoing efforts to lobby the US for a tariff exemption.
“There's no country in the world that has a lower tariff than Australia - it's important to point that out. This is 10 per cent across the board as a minimum, many countries have higher rates,” Albanese told ABC News Breakfast last Tuesday (1 July).
“What that means is that the comparative advantage, if you like, of Australian industries compared with exports … from other countries into the United States, we aren't having a disadvantage.”
A productivity commission (PC) report predicted that US tariffs would not have strong direct impacts on Australia’s economy - in fact, their modelling indicated that the tariffs could have a small positive effect on Australia’s economy.
This would be due to cheaper imports from the rest of the world and an outflow of productive capital from the US and highly tariffed economies, which is projected to give a slight boost to Australian production.
The PC noted that this modelling excluded the effects of global uncertainty, which is set to have a negative effect on Australia’s economy.
“Australia’s prosperity has been built on free and open trade. The proposed tariffs are likely to have a relatively small direct effect on us, but the global uncertainty they’ve brought about could affect living standards in Australia and around the world,” said PC deputy chair Dr Alex Robson.
“Uncertainty is a handbrake on investment – when businesses are uncertain about the future, they are less likely to invest.”
Legal challenges have compounded the uncertainty surrounding the tariffs. In May, a US trade court found that Trump’s use of emergency powers to impose tariffs without congressional approval had been unconstitutional.
On multiple occasions, Trump invoked the International Emergency Economic Powers Act of 1977 (“IEEPA”) to impose tariffs as he saw fit. He has declared several “national emergencies” since taking office in January 2025, ranging from fentanyl to the US trade deficit.
In May, the court determined that the IEEPA provision enabling the president to “regulate … importation” in response to a national emergency did not authorise Trump to impose whatever tariff rate he deemed desirable.
“Indeed, such a reading would create an unconstitutional delegation of power,” court documents warned.
Despite the trade court’s determination that Trump’s tariffs were illegal, the US court of appeals temporarily reinstated the tariffs while the case underwent further review. The appeals court is set to hear arguments on 31 July, placing the legal basis of the tariffs under scrutiny once again.
The White House said that more tariff letters would be sent out in the coming days and weeks, ahead of the 1 August deadline.
Since ‘liberation day,’ the US has only reached trade deals with the UK and Vietnam, and formed a framework for co-operation with China. More deals are expected to be announced before 9 July.
“President Trump is the best trade negotiator in history. His strategy has focused on addressing systemic imbalances in our tariff rates that have tilted the playing field in favor of our trading partners for decades,” the White House wrote in a statement.
“Today’s announcement, based on reciprocity and fairness, will help usher in a Golden Age for the American People.”
