- with readers working within the Insurance industries
Washington, D.C. (October 7, 2025) - On September 5, 2025, President Trump issued an executive order modifying the scope of reciprocal tariffs and establishing procedures for implementing trade and security agreements, pursuant to the International Emergency Economic Powers Act of 1977 (IEEPA) and the National Emergencies Act (NEA). President Trump's IEEPA tariffs are currently subject to federal court challenges. Lewis Brisbois recently published a Client Alert on these court challenges, entitled "Recent Updates to Trump Tariff Appeal."
The executive order updates Annex II to the April 2, 2025 "Liberation
Day" reciprocal tariff order, adding many categories to the
Harmonized Tariff Schedule of the United States (HTSUS), and
removing others. The products listed in Annex II "are not
covered by the duties imposed by Executive Order 14257." The
list of items added to Annex II includes bullion-related articles,
certain critical minerals, and "pharmaceutical products
subject to pending Section 232 investigation." Certain
aluminum hydroxide, resin, and silicone products were removed from
the list, making them subject to reciprocal tariffs.
In addition to modifying Annex II, the executive order established
the Potential Tariff Adjustment for Aligned Partners (PTAAP) Annex
(found at the same link as Annex II, page 38), which provides a
list of products that may be eligible for exemption from reciprocal
tariffs for each trading partner "based on the scope and
nature of the trading partner's commitments" under a trade
agreement. In other words, if a favorable trade deal is reached,
reciprocal tariffs on such goods could be subject only to a
presumably lower most-favored nation (MFN) tariff.
The White House issued a fact sheet noting that products on the PTAAP list include the following:
- Certain aircraft and aircraft parts;
- Certain generic pharmaceuticals and their ingredients;
- Unavailable natural resources and closely related derivative products; and
- Certain agricultural products not grown or produced in sufficient quantity in the United States to meet domestic demand.
On September 29, 2025, President Trump issued a proclamation adjusting rates of duty on imports of timber, lumber, and their derivative products into the United States. The proclamation imposes the following Section 232 ad valorem taxes:
- 10% on imports of softwood timber and lumber;
- 25% on imports of certain upholstered wooden products; and
- 25% on imports of kitchen cabinets and vanities.
On January 1, 2026, the duty rates on upholstered wooden products will increase to 30% and the duty rates on kitchen cabinets and vanities will increase to 50%. The United Kingdom (UK), the European Union (EU), and Japan will receive MFN under the proclamation. The imports of wood products from the UK will be capped at a 10% duty rate and wood products from the EU and Japan will be capped at a 15% duty rate for the combined Section 232 tariff and MFN tariff.
Key Takeaways
The administration added many products to the HTSUS, making such
products exempt from reciprocal tariffs and removed others. It also
established a list of products that may be subject only to the
most-favored-nation tariff following a future trade or security
deal. As to the new tariffs on wood and furniture products, though
the proclamation states that it will "strengthen supply
chains, bolster industrial resilience, create high-quality jobs,
and increase domestic capacity utilization for wood products,"
the new tariffs are likely to increase lumber, building, and
furniture costs for consumers.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
