U.S. proposes fresh tariffs on 60 economies over forced labor trade practices

The Office of the U.S. Trade Representative has proposed additional tariffs of up to 12.5% on imports from 60 economies over their failure to ban goods made with forced labor, in a sweeping action that would hurt most trading partners, including China, the European Union and Japan.

The determination, made under Section 301 of the Trade Act of 1974, found that all 60 countries have failed to impose or effectively enforce a prohibition on forced labor-related imports, creating what it called an “unlevel playing field” for American workers.

USTR has proposed a 10% duty rate for economies that have adopted a full or partial prohibition on forced labor trade, and 12.5% for all other economies.

The trade authority also proposed a separate textile mechanism that would allow for a certain volume of apparel and textile imports from some economies to enter the U.S. at reduced rates.

“The failure of our most important trading partners to address the importation of goods made with forced labor is unacceptable. This creates a dynamic where American workers are forced to compete globally on an unlevel playing field,” said U.S. Trade Representative Jamieson Greer.

“We will no longer tolerate this disparity. Some trading partners have taken initial steps to prevent the importation of forced labor goods, including through USMCA and commitments in Agreements on Reciprocal Trade. However, each of our trading partners must do more to ensure that trade does not perversely encourage and entrench forced labor globally.”

The proposal comes after the U.S. Supreme Court struck down most of President Donald Trump’s “Liberation Day” tariffs earlier this year, leaving a 10% global baseline in place. The administration has since turned to Section 301, which authorizes the president to impose levies to counter unfair foreign trade practices harming U.S. commerce.

Written comments for the proposal are due by July 6, with public hearings scheduled on July 7, according to the notice.

Separately, the U.S. government also started seeking public comments Wednesday on the scope of a new U.S.-China Board of Trade — agreed by the two sides during a bilateral summit last month — which would lead to reduced tariff rates on each other’s goods. The government has also sought public opinion on non-sensitive sectors that could benefit from tariff modifications on both sides.

— CNBC’s Evelyn Cheng contributed to the report.