Donald Trump’s administration has opened a fresh front in its trade war with America’s biggest commercial partners, proposing new tariffs of between 10 and 12.5 per cent on 60 economies, Britain among them, accused of failing to clamp down on goods made with forced labour.
It is the second time the White House has reached for new import taxes since the US Supreme Court struck down many of the president’s earlier duties in February, and the first to be brought under Section 301 of the 1974 Trade Act, a statute that allows Washington to investigate and penalise foreign trade practices it deems unfair. The list of targeted partners, including the UK, the European Union, Canada, India, China and Japan, covers approximately 99.4 per cent of US imports.
Jamieson Greer, the US Trade Representative, said the move was needed to rebalance global competition. The failure of America’s most important trading partners to tackle forced labour was, he argued, “unacceptable” and created “a dynamic where American workers are forced to compete globally on an unlevel playing field”. The full reasoning is set out in the USTR’s official press release of 3 June 2026, which proposes hearings on 7 July and a public comment window closing on 6 July.
Under the proposals, Britain joins Canada, the EU, Mexico, Indonesia, Pakistan, Argentina, Bangladesh, Cambodia, El Salvador, Guatemala, Malaysia and Taiwan in facing a 10 per cent additional duty — the lower of the two bands, reserved for economies that the USTR concedes have at least committed to prohibiting forced labour imports, even if enforcement is judged inadequate.
The remaining 45 trading partners, including China, India, Japan, South Korea, Brazil and Switzerland, face the steeper 12.5 per cent rate. The tariffs are not yet in force; the administration must still complete its statutory consultation process before they can be enforced. As CBS News reports, the route through Section 301 is widely seen as the Trump team’s workaround after the Supreme Court closed off its previous emergency-powers justification.
For British SMEs — particularly the small and medium-sized exporters that have spent the past year rebuilding their American order books after the chaos of the first round of duties — the announcement lands at a particularly bruising moment. Industry data already shows that British factories have cut US exports as Trump tariff uncertainty bites, with a significant minority of manufacturers actively rethinking their reliance on the American market.
The fresh 10 per cent levy, if imposed, would in many cases stack on top of existing sectoral tariffs. Business Matters columnist Richard Alvin recently argued in a recent Business Matters column on the squeeze on British exports, the cumulative effect is not so much a single shock as a slow tightening of the screws, eroding margin, lengthening payment cycles, and forcing smaller exporters into difficult choices over pricing, production location and product mix.
The framing under forced labour adds an extra layer of risk: it pulls UK companies into a broader compliance debate that, until now, was largely the preserve of multinationals subject to the Modern Slavery Act’s transparency requirements. SME exporters that thought themselves comfortably below the £36 million turnover threshold may yet find their supply chain due diligence under fresh American scrutiny.
The Government’s response has been measured but firm. A UK spokesperson stressed that Britain is “tackling forced labour in the UK and in global supply chains to ensure UK businesses are not complicit in forced labour and human rights violations” and that ministers continue to “engage regularly with the US administration as part of our negotiations”. The UK’s Independent Anti-Slavery Commissioner has previously noted the progress made since the passage of the Modern Slavery Act 2015 in improving awareness and understanding of human trafficking.
Brussels was sharper. A European Commission spokesperson called the proposed tariffs “unjustified” and reiterated that the EU remained committed to the trade deal struck with the Trump administration last year. Beijing was sharper still: foreign ministry spokesperson Mao Ning denied any forced labour in China and accused Washington of “using this as an excuse for political manipulation”.
In Delhi, Ajay Srivastava of the Global Trade Research Initiative urged India to challenge the legal basis of the move, arguing it stretches the scope of Section 301 beyond its intended remit and forms part of “broader US pressure tactics” that should be kept separate from live bilateral trade talks. He went further, suggesting India should “reassess its participation and consider stepping away from the bilateral trade agreement, as Malaysia has done”.
The proposed duties come after a March 2026 USTR investigation, the conclusions of which underpin Tuesday’s announcement. The report found that 54 of the 60 economies under examination had “failed to impose a legal prohibition on the importation of goods produced wholly or in part with forced labour and to effectively enforce such a prohibition”, while six others — Canada, the EU, Ecuador, Indonesia, Mexico and Pakistan — had failed on the enforcement leg alone.
This is the first significant new tariff salvo since the February Supreme Court ruling that struck down Trump’s so-called “Liberation Day” duties. The president called the ruling “terrible” and labelled the justices who rejected his trade policy “fools”. A temporary 10 per cent global tariff is currently in force, due to expire in July unless Congress extends it. Sentiment among UK manufacturers has soured noticeably, with British manufacturers turning their backs on the US as an export market amid Trump-era trade turmoil, and many quietly accelerating diversification into Gulf, Indo-Pacific and intra-European markets.
For owner-managed British exporters with US-facing revenue, the to-do list for the next eight weeks is unusually concrete. Audit the country-of-origin certification on every product line shipped into the US. Stress-test pricing models on the assumption that a 10 per cent duty stacks on top of any sectoral tariff already paid. Tighten supplier due diligence to forestall forced labour exposure further down the chain. And, perhaps most importantly, prepare for the consultation hearings on 7 July, where industry submissions could yet shape the final scope of the duties.
The political theatre will continue. The economics, as ever, will be quieter and more grinding, and will be felt, as they always are, first in the order books of Britain’s SME exporters.
