The tariff that has covered nearly every US import since February expires at 12:01 a.m. ET Friday, July 24, and the replacement the White House has been building still hasn't been announced.
That's Section 122, the 15% global surcharge the Trump administration invoked days after the Supreme Court ruled 6-3 in February that the older IEEPA authority didn't let the president impose tariffs. Congress capped Section 122 at 150 days and reserved any extension to a legislative act. No extension has been introduced, so the surcharge lapses on its own.
When it does, Capital Economics estimates the average effective US tariff rate drops from roughly 13% to roughly 7.2%, a swing of nearly six percentage points overnight.
The replacement is a Section 301 forced-labor framework. USTR issued findings on June 2 that 60 economies failed to ban or enforce bans on goods made with forced labor, and proposed duties of 10% on 15 of them and 12.5% on the other 45. US Trade Representative Jamieson Greer told CNBC on Tuesday those tariffs would cover "about 99% of our trade" and that "we expect to see some action soon." USTR had set itself an internal deadline of July 20 to finalize the determination. That passed without an announcement.
Unlike Section 122, Section 301 duties carry no statutory rate cap and no expiration date. Greer defended the strategy before the Senate Finance Committee on Wednesday, pointing to a $202.1 billion 2025 goods trade deficit with China, the lowest since 2004.
For importers, the Statt brief warns against betting on a clean rollback. Goods entered after the deadline shouldn't face the Section 122 surcharge, but a Section 301 duty could take effect on or near the same date once published in the Federal Register. The CEO of Traeger Grills told Greer during a Utah visit this month that the policy whiplash had made the past year and a half a "nightmare for businesses."
