President Trump is hitting many countries with new taxes called tariffs. These are fees on things countries sell to the United States. On August 1, Brazil is set to face the highest tax at 50%, while Iraq, Algeria, and Sri Lanka face 30% taxes.
Other nations like Brunei, Libya, and Moldova will pay 25%, and the Philippines 20%. Trump says these taxes fix “grave injustices” and trade imbalances.
For example, the U.S. buys $5.9 billion more from Iraq than it sells there. Surprisingly, Brazil sells less to the U.S. than it buys, yet still gets the highest tax.
Letters warn 14+ nations
Trump sent warning letters to at least 14 countries, telling them their new tax rates if they don’t comply by August 1. Japan and South Korea, big U.S. partners, face 25% taxes.
Laos and Myanmar got the highest threat at 40%. Some countries saw lower rates than in April: Cambodia’s tax dropped from 49% to 36%, and Bosnia’s from 36% to 30%.
The White House says it won’t add these taxes on top of existing ones, like the 25% tax on cars. Stocks fell after the news, but Asian markets stayed calm.
Deals, delays, and pushback
Only the U.K., Vietnam, and China have deals to avoid the worst taxes so far. Others are scrambling to talk before the deadline.
South Korea promised “bold action” if needed, and Japan called its tax “regrettable.” Brazil threatened to hit back with a 50% tax on U.S. goods. South Africa said Trump used the wrong trade data.
Meanwhile, the U.S. economy shrank 0.5% last quarter, and stores warn of shortages and higher prices. Trump claims the taxes will “supercharge” U.S. factories and help consumers.
The August 1 deadline is “firm, but not 100% firm,” says Trump.
If countries remove their own trade barriers, taxes could drop. But if they fight back, taxes could rise. Courts are still deciding if Trump’s use of emergency powers for these taxes is legal, with a key hearing set for July 31. For now, the taxes keep coming, adding over $100 billion to U.S. funds this year. As talks continue, the world watches to see who escapes the tariff fury.