Brazil Rejects US 12.5% Tariff as Unjust

What exactly did Brazil's minister say about the 12.5% tariff?

Minister Márcio Elias Rosa stated that the 12.5% tariff announced by the United States is "undue" and based on "facts that are not real." He stressed that Brazil has historic commitments to fighting forced labor, is a signatory to all International Labour Organization (ILO) instruments, and neither condones nor supports such practices.

How many tariffs is Brazil now facing from the US?

Brazil is now hit by two separate US tariffs. The first — 25% — was announced the previous week. The second — 12.5% — was announced on Thursday, July 23, and took effect at 00:01 Washington time on Friday, July 24, under Section 301 of the US Trade Act.

Which Brazilian sectors will be hit hardest?

About 2,000 Brazilian products exported to the US will face neither tariff. However, several sectors will be subject to both, bringing the combined rate to 37.5%. These include:

• Footwear
• Machinery and equipment
• Parts and components
• Clothing and textiles
• Non-pharmaceutical chemicals

Is Brazil considering retaliation?

Minister Elias Rosa said Brazil "cannot renounce" the possibility of using reciprocity measures, calling it a right that protects the Brazilian economy. However, he was clear that the primary goal remains negotiation — the aim is to avoid and remove these tariffs, which he described as "extremely unjust and very harmful."

What is the US justification for the new tariff?

Washington says the tariff results from a Section 301 investigation concluding that certain trading partners fail to prohibit or adequately monitor the import of goods made with forced labor. Countries that adopted measures against the practice face 10%; those that did not face 12.5% — Brazil falls in the latter category according to the US government, a classification Brasília firmly rejects.