US to impose 7.5% tariff on China

The United States is set to impose a 7.5% tariff on Chinese goods over allegations of excess manufacturing capacity, ahead of a planned summit between President Donald Trump and President Xi Jinping in Washington on September 24. The move would restore Trump's second-term duties on China to around 20%, a level Beijing has previously said is consistent with its trade truce. The tariff is part of the Trump administration's efforts to rebuild its tariff wall after the Supreme Court struck down previous global levies. The administration is justifying the new duties under Section 301 of the Trade Act of 1974, following an investigation into overcapacity. The exact rates are not yet finalized, and options include announcing a higher rate but suspending part to achieve an effective 7.5%. The move comes as Washington and Beijing seek to extend their trade pact, which expires on November 10. The tariff has faced legal challenges, including a lawsuit by a coalition of 25 states. The administration has also imposed a 12.5% tariff on Chinese goods over forced labor concerns, and has applied a 50% levy on Canadian products. Treasury Secretary Scott Bessent has threatened economic punishment against countries doing business with Iran.