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U.S. Reciprocal Tariff Executive Order, explained

A high-level summary of the actions taken, exceptions made, and implicated trade volumes

This short analysis breaks down the April 2, 2025 US Reciprocal Tariff Executive Order affecting $1.60 trillion in imports. We provide detailed coverage of the dual-action tariff structure (global 10% base plus country-specific additional duties), all exceptions, and precise trade volume implications across countries, sectors, and products. For trade professionals and policy analysts navigating these complex new measures, this explainer offers the factual foundation needed to assess potential impacts on supply chains, trade relationships, and market strategies without speculation or political framing. Latest Update: 14 April 2025, 9 am CET.

Authors

Johannes Fritz

Date Published

07 Apr 2025

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On April 2, 2025, President Trump signed an Executive Order imposing substantial new tariffs on global imports. This short explainer seeks to clarify actions taken, exceptions available and the implied trade volumes (using 2024 US import statistics).

Actions Taken

  1. Global Base Tariff: A 10% additional duty on all imports entering the United States, effective April 5, 2025. The administration invoked the International Emergency Economic Powers Act (IEEPA), declaring a national emergency stemming from what it terms "atrophy of domestic production capacity" due to persistent trade deficits.

  2. Country-Specific Additional Duties: Beyond the base 10% tariff, additional duties on imports from 57 jurisdictions take effect April 9, 2025. These rates appear formula-based and are designed to "rebalance global trade."

The Executive Order grants the President authority to modify these rates based on trading partners' remedial actions or continued concerns about manufacturing capacity.

Exceptions Made

Country-level Exceptions

Two sets of trading partners are excluded from both actions:

  1. USMCA partners (Canada and Mexico): Imports qualifying as originating under USMCA remain exempt, though non-originating goods face separate duties under previous border-focused Executive Orders
  2. Countries subject to HTS Column 2 rates: Belarus, Cuba, North Korea, and Russia

 

Product-Level Exclusions

  1. EO Annex II exceptions covering 1,039 specified product categories (at 8-digit HS code level)

  2. IEEPA statutory exceptions covering 38 HS codes

  3. "Semiconductor" exceptions covering 57 HS codes

  4. Products already subject to other trade actions:

    1. Steel, aluminum, and derivative products (652 HS codes) covered by Section 232 tariffs

    2. Automobiles and parts (247 HS codes) covered by a separate Section 232 action

Implicated Trade Volumes

Based on 2024 import values of $3.14 trillion, the Executive Order's impact is substantial:

Unaffected Trade ($1.54 trillion):

  • Annex II product exceptions: $653 billion

  • Mexico exception: $406 billion

  • Canada exception: $232 billion

  • "Semiconductor" exception: $242 billion

  • IEEPA product exceptions: $4 billion

  • HTS Column 2 exceptions: $20 million

Affected Trade ($1.60 trillion):

  • Subject to 10% IEEPA rate: $874 billion

  • Subject to higher country-specific rates: $241 billion

  • Subject to Automobile EO: $336 billion

  • Subject to Aluminum/Steel actions: $151 billion

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High-Level Summary of the Reciprocal Tariff Executive Order