US officially starts collecting Trump’s new 10% tariff

US customs officials began collecting a sweeping new 10% tariff on Saturday, following the latest American trade policy enactment made by President Donald Trump on April 2. The 10% baseline tariff, which came into force at 12:01 AM ET on April 5, applies to all imports from most countries, with significantly higher levies on goods from 57 trading partners. 

According to Reuters, customs agents at US ports, airports, and bonded warehouses began enforcing the duty at the stroke of midnight, with no grace period for new shipments.

“This is the single biggest trade action of our lifetime,” said Kelly Ann Shaw, a former White House trade adviser and current trade attorney at Hogan Lovells. Speaking at a Brookings Institution event days before the tariffs took effect, Shaw predicted that countries would be forced to negotiate new trade terms over time. 

“This is a pretty seismic and significant shift in the way that we trade with every country on earth,” she said.

Global market prepare for trade levies

The initial wave of 10% tariffs hits a wide range of countries, including Australia, Britain, Colombia, Argentina, Egypt, and Saudi Arabia. A Customs and Border Protection bulletin issued to importers confirmed that cargo already in transit before the deadline will be granted a 51-day grace period, allowing it to enter the US without the new duties, so long as it arrives by 12:01 AM ET on May 27.

The impact of the policy is expected to escalate further next Wednesday, when the Trump administration’s alleged “reciprocal” tariff rates are scheduled to take effect. These range from 11% to as high as 50%, spanning across US trading partners based on what the administration calls unfair trade practices or unbalanced trade relationships.

European Union imports will face a 20% tariff under the new structure, and Chinese goods, already hit by a variety of levies dating back to Trump’s first term, will contend with a 34% additional duty, bringing the cumulative tariff rate on Chinese imports to a whopping 54%.

Vietnam, a beneficiary of companies fleeing China during the Trump 1.0 US-China trade war, has been slapped with a new 46% tariff. Vietnamese officials agreed Friday to open discussions with the Trump administration about a trade deal, but no timeline has been set.

Southeast Asian nations, including Laos and Cambodia, are also among those facing tariffs between 46% and 49%, which could disrupt major supply chains in consumer goods, machinery, electronics, and textiles.

Canada and Mexico were spared from Trump’s latest tariff package. Still, both nations are subject to a separate 25% duty imposed earlier as part of the administration’s efforts to combat the fentanyl crisis. That measure targets goods that fail to comply with the US-Mexico-Canada Agreement (USMCA) rules of origin.

According to the US Census Bureau, China, the European Union, and Mexico were among the top three suppliers of US imports in 2024, jointly accounting for roughly a quarter of all incoming goods.

New tariffs leave out metals and auto parts, covers alcohol bevarages

Trump’s new tariffs do not apply to imports already covered by national security tariffs introduced during his first term, such as those on steel, aluminum, cars, trucks, and auto parts.

The administration also released a list of over 1,000 product categories exempt from the new duties. These goods, including crude oil, petroleum products, pharmaceuticals, uranium, semiconductors, titanium, copper, and lumber, accounted for approximately $645 billion in US imports in 2024.

However, while exempt for now, some of these sectors are reportedly under review when President Trump’s camp make revisions for the national security-related tariffs.

One of the most affected industries is alcohol, where Trump imposed a 25% tariff on imported beer and extended existing aluminum tariffs to include empty beer cans. European producers also face new levies under the broader EU tariff, while many spirits and wine categories are now subject to duties.

Although fears of 200% tariffs on European alcohol and 25% duties on Mexican tequila and Canadian whisky have not materialized, industry groups say the damage has already been felt.

Chris Swonger, CEO of the Distilled Spirits Council of the United States, told Reuters that the sector had enjoyed largely tariff-free trade for decades and should not be dragged into America’s geopolitical disputes. 

“The spirits industry has enjoyed zero-for-zero tariffs largely for decades and needed to be disentangled from the trade problems Trump wanted to solve,” he said.

Federvini, Italy’s leading wine and spirits trade group, warned that US sales of French wine and spirits were likely to fall by at least 20% under Trump’s regime. The group said the last time the POTUS implemented similar tariffs, Italian exports to the US fell by 50%.

“Many labels, which cannot be replaced by local production, will disappear from the tables of US consumers,” said Federvini President Micaela Pallini. “A serious production and employment crisis is looming in Italy and Europe.”

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