The administration of United States President Donald Trump has proposed a new 25 percent tariff on imports from Brazil amid allegations of unfair trading practices.
US Trade Representative Jamieson Greer announced the new punitive tariffs late on Monday, stemming from issues including digital trade and illegal deforestation.
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The new tariffs would be imposed under Section 301 of US trade policy — a statute that gives the US government broad authority to impose trade sanctions based on violations of trade agreements, as well as what it deems “unfair” trade practices under the Trade Act of 1974.
Greer said there has been an investigation that began in July. The practices under investigation were related to issues such as illegal deforestation, ethanol market access, and anticorruption enforcement, among other key issues, according to the summary released by the US Department of Commerce on Tuesday.
In the 107-page document, the US government said that trade practices between the two nations “are unreasonable and burden or restrict US commerce”, and pointed to agreements that Brazil has with Mexico and India.
“Brazil’s trade arrangements with Mexico and India also create incentives to offshore US production by creating a financial advantage to exporting to Brazil from these countries, as opposed to exporting from the United States,” the document says.
There is a comment period for the general public to weigh in on the proposed tariffs, which begins on Thursday. The written comment period ends on July 1, and there will be a public hearing in Washington on July 6.
Beef, coffee, rare earths, other metals, energy, and aircraft parts are among the products that would be exempt from the tariffs.
On CNBC, Greer said that it would release more findings on unfair trade practices in the next several weeks in order to address what Greer called a “giant” trade deficit.
However, the data shows that the US maintains a trade surplus with Brazil. In March, Brazil bought more goods, worth $3.3bn, from the US than it exported at $2.9bn, representing a $420m trade surplus.
Other countries under investigation include China and Vietnam.
The new tariff would partially replace a tariff of 50 percent on many Brazilian goods imposed last year by Trump, with 40 percent serving as a punishment for Brazil’s prosecution of former President Jair Bolsonaro, a Trump ally.
The White House also recently dropped tariffs on select aluminium, copper, and steel imports, which include agricultural equipment such as harvesters. Those tariffs will drop from 25 percent to 15 percent. The tariffs expire in December 2027.
The new tariffs come after the Supreme Court, in February, struck down the use of the International Emergency Economic Powers Act (IEEPA), which the White House used to impose its sweeping global tariffs.
“They are the first of many new tariffs to replace the IEPPA national security tariffs. The period of public comment will allow for potential modest tweaks and exemptions. Ultimately, it will add to some inflation pressure compared to the last few months but not compared to a year earlier,” Rachel Ziemba, a senior adjunct fellow at the Center for a New American Security, told Al Jazeera.
Political tensions
The changes come despite President Luiz Inacio Lula da Silva’s visit to Washington last month, as relations have deteriorated in recent months.
The US State Department has also designated two of Brazil’s criminal gangs as “terrorist organisations”, a move that supported Senator Flavio Bolsonaro’s position, Lula’s main rival in October’s election, and over the objections of Brazilian officials.
“I expressly asked President Trump not to tariff our companies,” Bolsonaro wrote on X on Tuesday. “Tariffs are not the solution.”
The White House did not respond to Al Jazeera’s request for comment.
