US President Donald Trump on Thursday announced another wave of tariffs on foreign imports, including a 100% levy on branded and patented pharmaceuticals and a 25% duty on heavy trucks, both set to begin from October 1.
Since taking office for his second term, Trump has leaned heavily on tariffs as an economic and political tool, slapping charges ranging from 10% to 50% on key trade partners and targeting individual sectors.
The new package, unveiled on Trump’s Truth Social account, left several questions unanswered — including whether the duties would be stacked on top of existing national tariffs or whether allies like the EU and Japan might be exempt, reports Reuters.
Japanese officials said on Friday they were still assessing the potential fallout.
In addition to the drug and truck measures, Trump also confirmed tariffs of 50% on kitchen cabinets and bathroom vanities and 30% on upholstered furniture, all effective October 1. He justified the move by claiming US markets were being “flooded” with cheap household imports.
Markets reacted swiftly
Pharmaceutical stocks in Asia tumbled, with Australia’s CSL hitting its lowest point in six years, Japan’s Sumitomo Pharma losing more than 5%, and Hong Kong’s Hang Seng Biotech Index down 2.5%.
A Chinese furniture manufacturers index also dropped by 1.1%.
The White House has been shifting toward stronger legal footing for its trade actions, as the Supreme Court reviews the legality of Trump’s wide-reaching tariffs. The president said the new 100% drug tariff would cover all imports unless companies have already broken ground on US factories.
The Pharmaceutical Research and Manufacturers of America warned the move could derail investment, stressing that drugmakers have pledged “hundreds of billions” in US projects.
Trump’s administration has also opened investigations into the security implications of importing everything from semiconductors and aircraft to timber, minerals, and renewable energy materials.
New probes announced this week cover medical gear, robotics, and industrial machinery.
Tariffs as strategy
Tariffs remain central to Trump’s foreign policy playbook, used both as leverage in negotiations and to pressure rivals. Treasury Secretary Scott Bessent has projected tariff revenues could reach $300 billion by year’s end.
Trump has previously imposed national security duties on steel, aluminum, copper, light-duty vehicles, and auto parts. Trade agreements with Japan, the EU, and the UK place ceilings on certain tariffs, meaning the latest hikes may not go beyond previously agreed levels.
Japan’s chief negotiator Ryosei Akazawa said the government was studying the new steps but insisted Tokyo’s “most-favoured nation” status meant Japanese drugs would not be singled out for higher tariffs.
Industry figures show that over half the value of ingredients for US medicines is sourced domestically, while most of the rest comes from Europe and allied economies.
In contrast, the American furniture sector remains heavily import-dependent. Imports hit $25.5 billion in 2024, a 7% jump from the prior year, with Vietnam and China supplying about 60%.
Trump has argued new tariffs would help revive industries in North Carolina, South Carolina, and Michigan, where manufacturing employment has fallen by half since 2000 to around 340,000 jobs.
Inflation risks
Economists warn that tariffs on commercial trucks could push up transport costs, adding pressure to consumer prices just as Trump promises to curb inflation.
He defended the new duties as necessary protection for US makers like Paccar’s Peterbilt and Kenworth and Daimler’s Freightliner.
The US Chamber of Commerce opposed the proposal, pointing out that the top suppliers of trucks to the US – Mexico, Canada, Japan, Germany, and Finland – are all allies posing no national security threat.
Mexico, which supplies the bulk of heavy and medium trucks, said its exports contain an average of 50% US-made components, including engines. Stellantis, which makes Ram trucks and vans in Mexico, is among firms likely to be affected.
According to Mexican government data, the US imported nearly $128 billion worth of heavy-vehicle parts from Mexico last year, equal to 28% of its total imports in that category.
