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Thompson Hine LLP, a full-service business law firm with approximately 400 lawyers in 11 offices, was ranked number 1 in the category “Most innovative North American law firms: New working models” by The Financial Times and was 1 of 7 firms shortlisted for The American Lawyer’s inaugural Legal Services Innovation Award. The firm has been recognized by the National Law Journal as a Legal Technology Trailblazer and featured by Bloomberg for its innovative service delivery models, which drive accuracy and predictability. The firm’s commitment to innovation is embodied in Thompson Hine SmartPaTHTM – a smarter way to work – predictable, efficient and aligned with client goals. For more information, please visit ThompsonHine.com and ThompsonHine.com/SmartPaTH.

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Following a <a href="https://truthsocial.com/@realDonaldTrump/posts/114825119138468153">threat</a> posted on his social media site Truth Social in early July, President Donald Trump issued an <a href="https://www.whitehouse.gov/presidential-actions/2025/07/addressing-threats-to-the-us/">Executive Order</a> (&ldquo;EO&rdquo;) on July 30, 2025, imposing an additional 40% tariff on U.S. imports from Brazil, effective August 6, 2025.&nbsp; With the 10% baseline reciprocal tariff established by President Trump&rsquo;s April 2, 2025 EO, tariffs on U.S. imports of Brazilian goods now total 50%.&nbsp; (For background on the 10% baseline tariff, see <a href="https://www.thompsonhinesmartrade.com/2025/04/trump-announces-reciprocal-tariffs-on-over-60-countries/">Update of April 3, 2025</a>.)&nbsp; Notably, however, there are a few items listed in Annex I of the EO, based on their classifications in the Harmonized Tariff Schedule of the United States, that are exempt from the additional 40% tariff.
To implement the 40% tariff, President Trump invoked the International Emergency Economic Powers Act of 1977 (&ldquo;IEEPA&rdquo;)&mdash;the same statute he has used throughout his second term to apply tariffs on a countrywide basis.&nbsp; In accordance with IEEPA&rsquo;s national security requirement, President Trump in the EO references Brazilian government actions &ldquo;that interfere with the economy of the United States, infringe the free expression rights of United States persons, violate human rights, and undermine the interest the United States has in protecting its citizens and companies.&rdquo;&nbsp; The EO also highlights the ongoing criminal prosecution of former Brazilian President Jair Bolsonaro, a prominent ally of President Trump, and recent policies and practices enacted by &ldquo;certain Brazilian officials&rdquo; that &ldquo;compel United States online platforms to censor the accounts or content of United States persons...on pain of extraordinary fines, criminal prosecution, asset freezes, or complete exclusion from the Brazilian market.&rdquo;
The EO also anticipates how the additional 40% tariff on U.S. imports of Brazilian goods will interact with other existing tariff regimes.&nbsp; The EO specifies that the tariff will be &ldquo;in addition to any other duties,&rdquo; thereby allowing for multiple tariffs to be applied to U.S. imports of Brazilian goods.&nbsp; The EO clarifies, however, that this 40% tariff cannot be stacked on top of tariffs imposed under Section 232 of the Trade Expansion Act of 1962.&nbsp; Section 232 permits the president to adjust duties on goods imported in quantities or under circumstances that threaten U.S. national security. 
Although the additional 40% tariff on U.S. imports of Brazilian goods will take effect soon, the EO includes a temporary reprieve for importers through a savings clause:&nbsp;goods loaded onto a vessel by August 5, 2025, and in transit on their final mode of transportation to the United States will not be subject to the additional tariff, as long as they are entered for consumption (or withdrawn from a warehouse for consumption) by October 5, 2025.&nbsp; According to the EO, however, if Brazil retaliates, President Trump may revise the EO &ldquo;to ensure the efficacy of the actions herein ordered,&rdquo; including raising tariff rates to correspond to any retaliatory tariffs Brazil imposes on U.S. exports.

Invoking IEEPA, President Trump Imposes an Additional 40% Tariff on Brazil

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