- US President Donald Trump has announced his previously announced global tariffs will be hiked from 10% to 15%, effective immediately.
- Trump unveiled a new global tariff to apply to all countries on Friday after the US Supreme Court struck down many of the previous tariffs as illegal.
- The new tariffs face several legal limitations likely to limit their effectiveness including a maximum duration of 150 days, a maximum rate of 15% and limits on which countries they can be imposed on.
US President and noted tariff enthusiast, Donald Trump, on Saturday hiked the 10% global tariffs he introduced just a day earlier to 15%, effective immediately.
Trump’s initial decision to impose the new 10% global tariffs came after the US Supreme Court ruled on February 20 that many of his tariffs — all those implemented under the International Emergency Economic Powers Act (IEEPA) — were illegal and must be removed.
On Saturday February 21, Trump took to his Truth Social platform to announce the tariff hike while also taking a passing shot at many unspecified trade partners for allegedly fleecing the US.
As President of the United States of America, I will be, effective immediately, raising the 10% worldwide tariff on countries, many of which have been ‘ripping’ the US off for decades, without retribution, until I came along, to the fully allowed, and legally tested, 15% level.
Donald Trump, US President The new tariffs are levied under Section 122 of the Trade Act of 1974. This is the first time in US history this section of the Act has been used to impose tariffs. The legislation allows for a maximum tariff rate of 15% to be applied for a maximum of 150 days before Congress must approve an extension.
These new tariffs will be layered on top of the already existing tariffs levied under other sections of the Trade Act of 1974 and the Trade Expansion Act of 1962, which were not impacted by the Supreme Court’s decision.
In his Truth Social post, Trump said that during those 150 days before Congress needs to approve the tariffs, his team would be working on implementing more “legally permissible” tariffs, which may prove to be less temporary and legally constrained.
According to lawyer and crypto thought leader Adam Cochrane, using Section 122 to implement the tariffs will also limit the countries Trump can impose tariffs on to those the US has a trade deficit with — a detail that’s likely to further limit their impact.
“The law he is using only allows this to be on countries we have a deficit with, for a set period of 150 days, and at a capped percentage,” Cochrane said in an X / Twitter post, adding “he [Trump] doesn’t even know how this works.”
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Most of Trump’s earlier tariff announcements have sent crypto markets immediately plummeting, but in the hours and days following this latest round of announcements, it held up fairly well.
Over the weekend, there were only slight falls, with Bitcoin remaining above US$67,000 (AU$94.7k) and other major cryptos also holding firm, with Ethereum holding just below US$2,000 (AU$2.8k) and Solana staying above US$82 (AU$115).
All that appeared to change Monday morning Australian time, as the crypto market suddenly began to drop precipitously starting around 11 am AEDT. In one hour on Monday morning, Bitcoin fell over 3%, from US$67,700 to US$65,000 (AU$91.9k), according to data from CoinGecko.
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Most other cryptocurrencies have followed Bitcoin’s lead, with some — such as privacy coin ZCash — seeing 24-hour losses in the double digits at the time of writing.
It’s not clear if this sudden drop is entirely down to tariffs or if other factors are affecting the market.
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