Tariffs

Definition

According to the U.S. International Trade Administration, a tariff or duty (the words are used interchangeably) is a tax levied by governments on the value, including freight and insurance, of imported products. Different tariffs are applied on different products by different countries. Some countries have very high duties and taxes, and others relatively low duties and taxes.

National sales and local taxes, and in some instances customs fees, are often charged in addition to the tariff. The tariff, along with the other assessments, is collected at the time of customs clearance in the foreign port. Tariffs and taxes increase the cost of a product to the foreign buyer and may affect a product’s competitiveness in the market. (Trade.gov).

Summary

The Trump administration promised the most disruptive change in Washington, D.C. ever seen. From the inaugural speech and into the early part of the new administration, there is much speculation about the extent tariffs may be used in three ways: to protect domestic industries from the unfair practices of foreign companies and foreign markets, raise revenue for the federal budget, and as leverage in foreign negotiations rather than the use of sanctions.

President Donald Trump stated in the inaugural speech, “I will immediately begin the overhaul of our trade system to protect American workers and families. Instead of taxing our citizens to enrich other countries, we will tariff and tax foreign countries to enrich our citizens.

The America First Trade Policy released on January 20 is directed to nine government entities. It states: “Americans benefit from and deserve an America First trade policy. Therefore, I am establishing a robust and reinvigorated trade policy that promotes investment and productivity, enhances our Nation’s industrial and technological advantages, defends our economic and national security, and — above all — benefits American workers, manufacturers, farmers, ranchers, entrepreneurs, and businesses.”

CalChamber Position

The CalChamber will continue to focus on lowering and eliminating tariff and nontariff barriers to support the expansion of American exports. While strategic use of tariffs or the threat of tariffs may be a meaningful negotiation tool, the CalChamber supports efforts to reduce taxation and regulatory burden as a means to create jobs and economic growth. Further, a focus on trade agreements instead will ultimately lower both tariff and nontariff barriers and help create long-term, sustainable economic growth.

The CalChamber opposes protectionist measures which create uncertainty, disrupt global supply chains, raise consumer prices, limit choices of products for consumers, hinder the competitiveness of California businesses, and invite retaliation.

The CalChamber believes strengthening economic ties and enhancing regulatory cooperation through agreements with our top trading partners that encompass both goods and services, including financial services, is essential to eliminating unnecessary regulatory divergences that may act as a drag on economic growth and job creation.

The CalChamber seeks commercially meaningful outcomes in negotiations with regions around the world and supports bilateral, regional and multilateral trade agreements, which are critical to consumers, workers, businesses, farmers and ranchers, and would allow the United States to compete with other countries that are negotiating agreements with each other.

California’s economy is diverse, and the state’s prosperity is tied to exports and imports of both goods and services by California-based companies, to exports and imports through California’s transportation gateways, and to movement of human and capital resources.

International trade and investment are major parts of our economic engine that broadly benefit businesses, communities, consumers, and state government.

Articles

CalChamber

Talk of Tariffs Keeps Global Connections in Spotlight for World Trade Month 2025
CalChamber May 2, 2025

Tariff Tumult Continues in April
CalChamber, April 25, 2025

CalChamber on Tariffs: Unnecessary Cost Hikes Hurt Business, Impact Consumers and Disrupt Global Supply Chains
CalChamber, April 16, 2025

Trump Orders New ‘Reciprocal Tariffs’
CalChamber, April 4, 2025

Trade Policy Expert Details Economic Impacts of Newly Declared Tariffs
CalChamber, March 11, 2025

Trump Tariffs: Some Put on Hold, Others Take Effect
CalChamber, February 4, 2025

Trump Tariff Plans Cause Concern, Much Speculation
CalChamber, January 31, 2025

White House

Modifying Reciprocal Tariff Rates to Reflect Discussions
with the People’s Republic of China
The White House, May 13, 2025

General Terms for the United States of America and the United Kingdom of Great Britain and Northern Ireland Economic Prosperity Deal
United States Trade Representative, May 9, 2024

Fact Sheet: U.S.-UK Reach Historic Trade Deal
The White House, May 8, 2025

The Department of Commerce together with USTR Announces Historic Trade Deal with the United Kingdom to Open Markets, Raise Revenue and Strengthen Security
U.S. Department of Commerce, May 8, 2025

Fact Sheet: President Donald J. Trump Incentivizes Domestic Automobile Production
White House, April 29, 2025

Amendments To Adjusting Imports Of Automobiles And Automobile Parts Into The United States
White House, April 29, 2025

EO: Addressing Certain Tariffs On Imported Articles
White House, April 20, 2025

Modifying Reciprocal Tariff Rates to Reflect Trading Partner Retaliation and Alignment
White House, April 9, 2025

Amendment to Reciprocal Tariffs and Updated Duties as Applied to Low-Value Imports from the People’s Republic of China
White House, April 8, 2025

Report to the President on the America First Trade Policy Executive Summary
The White House, April 3, 2025

Regulating Imports with a Reciprocal Tariff to Rectify Trade Practices that Contribute to Large and Persistent Annual United States Goods Trade Deficits
The White House, April 2, 2025

Fact Sheet: President Donald J. Trump Declares National Emergency to Increase our Competitive Edge, Protect our Sovereignty, and Strengthen our National and Economic Security
The White House, April 2, 2025

Adjusting Imports of Automobiles and Automobile Parts into the United States
The White House, March 26, 2025

Fact Sheet: President Donald J. Trump Adjusts Imports of Automobiles and Automobile Parts into the United States
The White House, March 26, 2025

Fact Sheet: President Donald J. Trump Adjusts Tariffs on Canada and Mexico to Minimize Disruption to the Automotive Industry
The White House, March 6, 2025

Fact Sheet: President Donald J. Trump Proceeds with Tariffs on Imports from Canada and Mexico
The White House, March 3, 2025

Fact Sheet: President Donald J. Trump Imposes Tariffs on Imports from Canada, Mexico and China
The White House, February 1, 2025

America First Trade Policy
The White House, January 20, 2025

The Inaugural Address
The White House, January 20, 2025

CalChamber Guest Commentaries

Challenges/Opportunities for California’s Trading Relationships Across the Americas
Richard Kiy, President and CEO of the Institute of the Americas in La Jolla, California, March 28, 2025

Guest Commentary: Stronger Together:
German American Trade Relations in a Changing World
Oliver Schramm, Consul General of the Federal Republic of Germany in San Francisco, March 18, 2025

Guest Commentary: Perspective on Impact of New U.S. Tariffs on Mexico
Christian Tonatiuh González Jiménez, Consul General of Mexico in Sacramento, March 4, 2025

Guest Commentary: The True Cost of U.S. Tariffs on Canada
Rana Sarkar, Consul General of Canada in Northern California, February 25, 2025

Legal Action

At issue is the International Emergency Economic Powers Act (IEEPA), which gives the president special authority over economic transactions during a national emergency. Historically used for foreign sanctions, Trump is the first president to use IEEPA to impose tariffs, first declaring a national emergency over the fentanyl crisis in the U.S. to impose tariffs on China, Canada and Mexico, then declaring that the U.S. trade deficit is a national emergency in order to impose high tariffs on trading partners around the world.

Governor Newsom seeks injunction to immediately stop Trump tariffs
Governor of California, May 13, 2025

House Democrats’ Litigation Task Force Challenges Trump’s Unlawful, Chaotic Imposition of IEEPA Tariffs
House Committee on the Judiciary, May 13, 2025

Board game company fights unconstitutional tariffs
Pacific Legal Foundation, April 24, 2025

A dozen states sue the Trump administration to stop tariff policy
The Associated Press, April 23, 2025

CalChamber on Tariffs: Unnecessary Cost Hikes Hurt Business, Impact Consumers and Disrupt Global Supply Chains
CalChamber, April 16, 2025

Governor Newsom files lawsuit to end President Trump’s tariffs
Governor of California, April 16, 2025

Can Trump’s Tariffs Be Undone In Court? First Lawsuit Targets ‘Liberation Day’ Orders As Conservative Lawyers Protest Policy
Forbes, April 15, 2025

V.O.S. Selections, Inc. v. Trump
Liberty Justice Center, April 14, 2025

NCLA Sues to Stop Trump Admin. from Imposing Emergency Tariffs That Congress Never Authorized
New Civil Liberties Alliance, April 3, 2025