President Donald Trump made two major changes to his levies on China as trade tensions between the US and China continue to escalate.
In an executive order on Tuesday, the president outlined the two new changes — raising tariffs on China to 104% and tripling tariffs on low-cost parcels.
The order came hours before Trump’s reciprocal tariffs took effect on Wednesday morning. He first announced the tariffs on April 2, a day he’s been calling “Liberation Day.”
He imposed a baseline 10% levy on goods from 185 countries, with some countries hit harder. Some countries were hit harder than others — the European Union was hit was a 20% tariff, Vietnam with 46%, and Lesotho with 50%.
Raising tariffs on China from 34% to 84%
Trump’s executive order on Tuesday wrote that, as of Wednesday, the reciprocal tariffs on China would be raised from the 34% he announced on April 2, to 84%.
This is on top of 20% tariffs already in place — bringing the total tariffs on China to 104%.
This change is in “recognition of the fact that the PRC has announced that it will retaliate against the United States,” per the executive order.
This is the largest escalation between the two countries in recent months, matching and surpassing Trump’s campaign trail promise of imposing tariffs of more than 60% on Chinese goods if elected.
Trump first imposed a 10% tariff on Chinese goods in February before increasing them to 20% in March.
Both times, China retaliated quickly to Trump’s tariffs. In February, China imposed a 10% tariff on crude oil and agricultural equipment and a 15% tariff on coal and liquefied natural gas.
In March, China introduced a 10% tariff on US soybeans, pork, and beef imports and a 15% tariff on chicken and cotton imports.
Following Trump’s April 2 announcement, China hit back with its own 34% tariffs against the US, which will take effect on Thursday. As of press time, China has yet to respond to the latest 104% tariffs.
China’s Commerce Ministry said Tuesday that Trump’s tariffs were “completely groundless” and a “typical unilateral bullying practice.”
“China will never accept this. If the US insists on its own way, China will fight to the end,” the commerce ministry said in a statement.
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Increasing de minimis tariffs
On April 2, Trump announced via an executive order that he would remove the de minimis tariff exemption loophole for packages costing less than $800 from China and Hong Kong.
He said a 30% levy would be imposed on these packages from May 2. But on Tuesday, Trump tripled it to 90%.
According to the Tuesday executive order, he also increased the per postel item fee on goods entering the US after May 2 and before June 1 from the planned $25 to $75.
After June 1, the fee was originally supposed to be $50 — but it’s now $150, per the executive order.
Representatives for Trump did not respond to a request for comment from Business Insider.
