US identifies Brazil's unfair trade practices, proposes 25% punitive tariffs

The United States has proposed imposing new punitive tariffs of up to 25% on a range of Brazilian goods, alleging unfair trade practices by Brazil. The U.S. Trade Representative's office announced the new measures, which are based on Section 301 of the Trade Act of 1974 and target digital payment services, preferential tariffs, intellectual property protection, and ethanol market access.

This move follows an investigation launched last year under the same trade provision, which found certain Brazilian practices to be "unreasonable and burden or restrict U.S. commerce." The U.S. Trade Representative's Office (USTR) is seeking public comment on the proposed tariffs, with a deadline of July 15. Notably, key exports such as beef, coffee, rare earth metals, other metals, energy, and aircraft components are excluded from the proposed duties.

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Due to the broad exemptions, this measure against Brazil is quite granular.

Brazilian President Luiz Inacio Lula da Silva responded by accusing U.S. Secretary of State Marco Rubio of working against Latin America. However, U.S. officials, including Jamieson Greer of the USTR, described the measures as "quite granular" due to the broad exemptions. Greer emphasized the necessity of substantial tariffs to address the United States' "huge" trade deficit and indicated that more investigations into unfair trade practices are expected in the coming weeks. Brazilian officials have suggested the U.S. rationale overlooks arguments previously presented by Brazil, implying political motivations behind the proposed tariffs.

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U.S. Secretary of State Rubio is fighting against Latin America.