Trump is trying yet another route to impose sweeping tariffs on US trading partners, months after his earlier “Liberation Day” tariffs were struck down by US courts. The latest duties, imposed under a different trade law, have already been challenged in court.
Unlike the tariffs announced in April 2025, which were imposed under emergency powers, the new duties announced by the Trump administration on Friday rely on Section 301 of the Trade Act of 1974. The administration has imposed tariffs on goods from more than 80 countries, arguing that they have failed to do enough to stop the use of forced labour.
The new tariffs cover countries responsible for 99.4% of US trade. Section 301 allows the US government to impose tariffs in response to what it considers unfair trade practices.
Two US small businesses challenge Trump’s new tariffs in court
Two small US businesses have challenged President Donald Trump’s latest round of tariffs, saying the new duties go beyond the president’s legal power to tax imports, Reuters reported. The lawsuit was filed on Friday in the US Court of International Trade in New York. It challenges tariffs imposed on goods from 60 trading partners.
The businesses argue that the Trump administration needed to provide more detailed findings for each country to prove that the tariffs were legally justified.
They also claim that Trump is trying to bring back tariffs that the US Supreme Court had already ruled illegal. The case is being supported by a nonprofit legal group that had also successfully challenged some of Trump’s earlier tariffs in court.
The latest tariffs announced on Friday are based on Section 301 of the Trade Act of 1974. The law is designed to allow the US to respond to unfair or discriminatory economic practices by other countries.
Unlike IEEPA and the legal authority used for the temporary global tariff, Section 301 has been used by previous US presidents.
However, the two small businesses argue that Trump is using the law in a way that has never been seen before. According to their lawsuit, Section 301 tariffs have traditionally been aimed at specific countries and specific industries. They say Trump’s decision to impose broad tariffs across 60 trading partners has no historical precedent.
Jeffrey Schwab, an attorney at the Liberty Justice Centre who represents the two businesses, said Section 301 does not give the president the power “to tax substantially all imports from substantially all countries at preestablished rates.”
Businesses want tariffs declared illegal
The lawsuit asks the US Court of International Trade to declare the new tariffs unlawful and stop the administration from enforcing them. It also asks the court to protect importers’ right to seek refunds for any tariffs that are later found to be illegal.
The two businesses behind the case are Burlap & Barrel, a spice importer that had earlier challenged Trump’s temporary 10% global tariff, and Collective Horology, a California-based watch retailer.
The latest case is the third legal challenge that could emerge against Trump’s tariff policies. In the previous two cases, US states led by Democratic politicians had joined the lawsuits.
Oregon Attorney General Dan Rayfield said his state was considering its options for a possible third lawsuit. Rayfield said the new tariffs would increase costs for ordinary Americans while doing nothing to stop forced labour in other countries.
India questions basis of new US tariff
India has also been hit by the new tariffs, with a 10% duty imposed on its exports to the US. The country has questioned the basis of the new US tariff, with the Global Trade Research Initiative (GTRI) saying the measure “lacks a credible factual basis” and that the US has not produced evidence showing that India imports goods made with forced labour. GTRI said the move appears aimed at keeping trade barriers in place rather than addressing forced-labour concerns.
The Indian government, meanwhile, said it had remained closely engaged with the US throughout the Section 301 investigation and had amended its Foreign Trade Policy to prohibit imports made using forced labour. It said these efforts helped India secure the lower 10% tariff rate, down from the 12.5% duty initially proposed by Washington
White House says forced labour is the real reason
The Trump administration has rejected the idea that it is simply trying to bring back the “Liberation Day” tariffs through another law.
Speaking to CNBC, a senior administration official said that fighting forced labour has been a long-standing priority for Trump. “Addressing forced labor is something that President Trump has been focused on … for many years,” the official said during a call about the new tariffs.
The official also explained why the administration was moving ahead with the tariffs at this time. “We’re implementing this at this moment really to avoid complexity,” the official said.
New tariffs hit 60 trading partners
The Trump administration on Friday imposed new tariffs of 10% and 12.5% on goods from 60 trading partners, including the European Union.
The administration says the tariffs are needed because these countries are not doing enough to stop the export of goods made using forced labour.
The new tariffs came into effect just as a temporary 10% global tariff expired. The White House and the US Trade Representative’s office did not immediately respond to requests for comment.
Trump has made tariffs a key part of his foreign policy. He has used them as a tool to put pressure on countries and negotiate trade deals around the world. But his tariff policy has faced several legal challenges.
Supreme Court had already struck down Trump’s tariffs
On February 20, the US Supreme Court ruled against most of Trump’s broad tariffs. The court found that the International Emergency Economic Powers Act, or IEEPA, did not give the president the power to impose tariffs on trading partners on his own. Trump criticised the Supreme Court after the ruling. He then imposed a new temporary global tariff of 10% under a different legal authority.
However, that move also faced legal trouble. Like the IEEPA tariffs, the temporary global tariffs were imposed using a part of the law that no previous president had used to impose tariffs. The US trade court also ruled those tariffs illegal, and the Trump administration is now appealing that decision.