Broad-Based U.S. Tariffs Announced

Commerce Lexington continues to monitor ongoing federal budget cuts, Tax Cuts and Jobs Act of 2017 extensions, and tariff announcements. On April 2, 2025, the White House imposed a variety of new tariffs, from a universal baseline tariff to nation, product, and commodity specific duties (Executive Order).

What You Need to Know:

• There is a 10% "reciprocal" baseline tariff. These are across-the-board levies on all imports, effective April 5, 2025. 
• On April 9, the Trump Administration announced a 90-day pause on a proposed “discounted reciprocal tariff” set to affect 57 nations. These tariffs, targeting countries identified by the White House as engaging in unfavorable trade practices, included rates such as 24% on Japan and 20% on the European Union. The pause allows for ongoing negotiations between the Administration and the affected countries to address trade concerns.
• Following waves of initial and retaliatory tariffs between the U.S. and China, the rate on most imports from China will be 145% when accounting for the International Emergency Economic Powers Act (IEEPA) border security and fentanyl tariffs. China retaliated with their own duties on U.S. imports with a 125% rate effective April 11. On that same date, U.S. Customs and Border Protection released revised guidance, exempting certain products—such as smartphones and semiconductor chips—from reciprocal tariffs on Chinese imports.
• Canada and Mexico are exempt from the proposed reciprocal tariff regime. However, most imports from these countries face a 25% tariff due to concerns raised by President Trump regarding their roles in the fentanyl crisis and illegal immigration. Compliant goods covered under the United States-Mexico-Canada Agreement (USMCA) remain eligible for exemptions.
• Trump’s 25% tariffs on foreign-made automobiles took effect April 3, 2025. Auto parts will be included in this 25% rate effective May 3. 
• President Trump’s Administration is considering or discussing the inclusion of copper, lumber, pharmaceuticals, and semiconductors in the evolving tariff policies.
• The Tax Foundation maintains a Trump Administration tariff timeline and further details regarding their economic effects.
• The U.S. Chamber of Commerce provides further context of how broad-based tariffs put U.S. growth at risk.

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In response to Canadian tariffs, both of Kentucky’s U.S. Senators Mitch McConnell and Rand Paul, joined fellow Republicans Susan Collins of Maine, Lisa Murkowski of Alaska, and all Senate Democrats to pass a resolution against undoing those specific duties on April 2. The resolution passed 51-48, with an unlikely future passage out of the Republican controlled U.S. House.

Commerce Lexington supports open trade policies with markets abroad and removing barriers that shut U.S. exports out of foreign markets.  The organization also supports efforts to implement fewer federal regulations and less taxation to grow our economy. However, we remain concerned about the potential negative economic impact of tariff policies on key industries in the Greater Lexington Region, Commerce Lexington will continue to monitor these issues, talk with business leaders, and communicate concerns to federal officials.  If your businesses or organization is concerned about tariff impacts, please contact Commerce Lexington to share feedback. 

Commerce Lexington is currently planning the annual D.C. Fly-In on July 9-10, 2025, where key leaders of the Greater Lexington business community will meet with key policymakers on Capitol Hill and in the Trump Administration. For more information or to register for the D.C. Fly-In, click here.