Why It Matters

U.S.-China tariffs have spiraled to levels not seen in decades, with the average American duty on Chinese goods reaching approximately 36.5% as of July, according to a Congressional Research Service (CRS) report, published Aug. 18. Supply chains for pharmaceuticals, semiconductors, and critical minerals face severe disruption, while retaliatory Chinese tariffs now target American agriculture, machinery, and energy exports.

Congress faces mounting pressure to weigh the tariff regime's economic costs against stated national security and trade practice objectives, while the Trump Administration continues expanding tariff actions across new product categories even as prior negotiations have stalled.

The Big Picture

Tariff rates have climbed in waves since 2018. The U.S. average duty on Chinese goods rose from 2.7% in 2017 to 19% by 2019 under Section 301 of the Trade Act of 1974, which the Office of the U.S. Trade Representative invoked after finding China engaged in forced technology transfer, cyber-enabled theft of U.S. intellectual property and trade secrets, discriminatory and nonmarket licensing practices, and state-funded strategic acquisitions of U.S. assets in 2018.

In 2025, it escalated; tariffs reached 39% in March, spiked to approximately 164% by April, then fell to 49% in May after a temporary agreement. Section 232 of the Trade Expansion Act of 1962 was used to impose tariffs on steel, aluminum, and autos. In February, the Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were unconstitutional, forcing their removal and causing rates to drop to approximately 34%. By July, a new 12.5% tariff under Section 301 for forced labor concerns brought the average to 36.5%.

In 2025, President Trump raised steel and aluminum tariffs to 50%. A 100% tariff on patented pharmaceuticals and active pharmaceutical ingredients took effect in April 2026, despite approximately 80 percent of global drug production relying on active pharmaceutical ingredients from China. Drones face 25% to 100% duties. Investigations into wind turbines, medical supplies, robotics, and anthracite coal remain ongoing.

China has responded with reciprocal measures. Chinese tariffs on U.S. goods reached approximately 146% in April 2025 before moderating. China has imposed export controls on rare earths and chemicals, cancelled orders for U.S. agriculture and aircraft, initiated antidumping and antitrust actions against American firms, and imposed market restrictions on specific U.S. companies. Current Chinese tariffs on select U.S. goods range from 10% to 15%.

U.S. and PRC officials have been in talks since 2025, but have yet to reach a deal.

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