Donald Trump’s new tariffs when it comes to pharmaceutical imports are not going to apply to countries having negotiated agreements with the U.S. that contain the provisions on drugs, as per a White House official, therefore delivering promised tariff relief for EU and Japan.
It is well to be noted that the duties on pharmaceuticals from the EU are going to be capped at 15%, as per the terms of its framework deal, said the White House official on September 26. The Japanese drugs are also going to be charged the rate that has been spelled out in their pact, confirmed the official. The U.S.-Japan joint statement remarks that the American tariff rates on Japanese drugs and semiconductors must not exceed the ones that are applied to others, which includes the EU too.
The U.K., yet another country that happens to export pharmaceuticals to the U.S., is also going to face a 100% tariff, as per the White House official.
London also went on to negotiate a trade agreement with Washington, which included the provisions for a similar exemption; however, the two countries have not agreed upon the rate for pharmaceuticals as yet.
Trump confirmed that the U.S. would go on to impose a 100% tariff on any sort of branded as well as pharma product until and unless that company is actually BUILDING its pharma manufacturing plant in the U.S. As per Trump’s post, no tariff will apply if the construction has begun.
However, this abrupt announcement that was made by the U.S. president included no further details, thereby leaving some overseas capitals confused if their deals with Washington went on to still apply to the new pharmaceutical tariffs. If a company happens to announce that they are going to build a plant in the U.S., then their products shall be exempt while the Commerce Department vets this announcement and goes on to conduct an approval process, said the official.
It is well to be noted that Japan went ahead and exported ¥411 billion, which is equivalent to $2.7 billion, in terms of pharmaceutical products to the U.S. in 2024, therefore making up 1.9% of the total exports to the country, as per the data coming from the Finance Ministry.
Apparently, the Trump administration has taken certain other steps in the recent past to execute the EU trade understanding and tariff relief for EU and Japan is a testimony to it. Earlier, the U.S. decreased the auto tariffs to 15% from 25% on top of the prevailing rates.
A White House official also said on September 26 that another 25% U.S. tariff when it comes to heavy trucks and parts is going to be applied to Japanese imports.
According to a social media post from Trump, he is going to impose a 25% tariff on heavy trucks that are imported into the country, effective October 1, 2025. It is worth noting that Japanese heavy trucks, as well as parts, are going to face a 50% U.S. tariff, which also includes a 25% levy that has been in place already.
The effect of the increased tariffs happens to be uncertain since the heavy trucks go on to represent a meager portion of exports from Japan to the U.S.
