In a bold move to counter massive trade deficits, President Donald Trump has invoked Section 122 of the Trade Act of 1974, slapping a 10% tariff on imported goods just days after the US Supreme Court struck down his previous levies. Effective February 24, this temporary measure lasts 150 days and aims to address what the White House calls ‘fundamental international payments problems.’
The administration released a detailed fact sheet explaining the rare use of this presidential power. Section 122 empowers the president to impose surcharges and import restrictions without prior investigation, allowing swift action on balance-of-payments crises. Unlike other trade laws, no formal probes are needed, making it a fast-track option for emergencies.
Key exemptions protect critical sectors: essential minerals, metals for currency and bullion, energy products, natural resources, fertilizers, select agricultural goods, pharmaceuticals, electronics, passenger vehicles, and more. These carve-outs ensure the tariffs target non-essential imports without disrupting vital supply chains.
The White House highlighted America’s dire trade imbalance, driven by insufficient domestic production. ‘The US must import most consumer goods, draining dollars from our economy to foreign shores,’ the statement noted. This outflow exacerbates the payments deficit, prompting the emergency tariffs.
Trump also directed the US Trade Representative to probe unfair foreign practices under Section 301, targeting discriminatory policies that burden American commerce. Experts warn the president could renew these tariffs before expiration by declaring a new payments emergency, potentially sidestepping Congress.
As global markets brace for impact, this revival of Section 122 underscores Trump’s aggressive trade agenda. While temporary, it signals a willingness to wield rarely used powers amid ongoing battles with trading partners. The 150-day clock is ticking, but the strategy’s longevity remains a hot debate among economists and policymakers.