Presidential Announcement: Threat of a 100% Tariff
The U.S. president recently publicly announced plans to impose an additional 100% tariffs on imports from China, which may be implemented as early as November 1[1][2]. This means an additional 100% ad valorem tax on top of the current tariff (the average tariff on Chinese goods is currently about 30%[2]), the effective tax rate may rise to about 130%. The president's move is seen as a major escalation in the U.S.-China trade war and is a direct response to China's recent new controls on rare earth exports[1][3]. The Chinese government has required export licensing for products containing even trace amounts of rare earth elements—an action described by U.S. officials as “unusually aggressive” [3]. In response to the U.S. tariff threat, Beijing has stated that it will not yield to pressure, emphasizing that China “does not want a trade war but is not afraid to fight one,” and urging that disputes be resolved through negotiation rather than tariff coercion[4]. In the statement, China's Ministry of Commerce reiterated its position on resolving conflicts through dialogue but warned that if the United States insists on escalating the trade war, China will "fight to the end." The series of tough statements triggered sharp reactions in global markets, with major U.S. stock indices falling immediately after the news broke[5].
Lack of Implementation Details and Policy Uncertainty
It is worth noting that, as of now, the U.S. government has not issued any official implementing documents regarding the additional 100% tariffs. For instance, no related notice has been published in the Federal Register, and neither the Office of the U.S. Trade Representative (USTR) nor U.S. Customs and Border Protection (CBP) has released any accompanying tariff schedules or operational guidance. This indicates that the President’s statement currently functions more as a policy signal and negotiation leverage, with actual implementation remaining uncertain. In fact, on August 11 this year, the White House issued an executive order extending the tariff truce previously reached with China (additional tariffs on China temporarily maintained at 10%) for another 90 days to November 10[6]. According to the executive order, the United States "reciprocal tariff" on China will continue to maintain a 10% surcharge rate during the extension period until mid-November[7][6]. This move shows that the United States chose not to immediately resume higher tariffs to continue negotiations with China. U.S. Treasury Secretary Bessent also revealed that the United States and China engaged in substantive discussions over the past weekend, reopening communication channels. He emphasized that Washington has no intention of causing the situation to get out of control."100% tariffs are not guaranteed", and no implementation action will be taken before November 1[8]. Bessent’s statement shows that the U.S. government is trying to de-escalate the situation through diplomatic channels, and that the tariff policy remains fluid. The news that President Trump and President Xi may meet at the multilateral summit later this month has further added to the uncertainty. If the leaders’ talks proceed smoothly, the U.S. may delay or even cancel the planned tariff escalation. However, if negotiations stall, companies should prepare for the possibility of a sudden tariff increase as early November approaches.
Distinction from the Already-Imposed 100% Tariff on Electric Vehicles
It is important to distinguish between the recently threatened across-the-board 100% tariff and the previously implemented tariff increases on specific products. In September 2024, under the Section 301 investigation against China, the U.S. government raised tariffs on imports of Chinese electric vehicles from 25% to 100% [9]. This adjustment formed part of a four-year tariff review targeting specific product categories, with the impact limited primarily to electric vehicles and a few critical items such as certain battery components and pandemic-related materials. The affected tariff codes and effective dates were clearly defined[10][11]. By contrast, the newly threatened 100% tariff now under discussion could potentially cover nearly all goods imported from China. According to the White House’s earlier “reciprocal tariff” framework, the proposed measure would apply to all products originating from mainland China, Hong Kong, and Macau[12]. In April of this year, the U.S. had already activated this broad-based tariff mechanism, at one point gradually increasing the additional tariffs on Chinese goods to as high as 125%[13]. However, following a temporary consensus reached between the U.S. and China in May, Washington lowered the surcharge to 10% in an effort to ease tensions[14]. This spring therefore marked a period of peak tariff confrontation between the two countries: overall U.S. tariffs on Chinese goods climbed to as high as 145%, while China imposed 125% retaliatory tariffs on U.S. products[15]. Subsequently, by mid-May, both sides agreed to lower their tariff levels—the U.S. to around 30% and China to 10%[15]. If the U.S. proceeds with the newly threatened additional 100% tariffs, overall tariff levels on Chinese goods could once again surge to exceptionally high levels, affecting a broad range of Chinese exports. Given that China’s total exports to the United States amounted to $438.9 billion in 2024[16], a "comprehensive 100% tariff" will have a far greater impact on bilateral trade than the earlier, product-specific increases on electric vehicles and related items.
Practical Implications and Recommended Corporate Responses
In light of the current policy uncertainty, cross-border businesses should closely monitor developments and prepare contingency plans in advance. First, importers and supply chain operators are advised to track official announcements—including statements from the White House, presidential executive orders, USTR notices, and updates to operational guidance issued by U.S. Customs and Border Protection (CBP). Once the U.S. government formally releases a tariff schedule and effective date, companies should promptly review the details to determine whether their products fall within the new tariff scope and whether any transitional arrangements apply. For example, under previous tariff measures, a grace period was sometimes granted for in-transit shipments—goods shipped before the effective date and arriving at U.S. ports within the designated window could remain subject to the original tariff rate [17]. Businesses should be mindful of such transitional arrangements and adjust their logistics plans accordingly. Second, shipment timing should be carefully evaluated in the near term. Where feasible, businesses may consider advancing or delaying shipments to avoid potential tariff effective windows, or splitting shipments to reduce exposure to higher tariffs on any single batch. Of course, any adjustment should carefully balance costs, inventory impacts, and compliance with all applicable regulations. Finally, companies should maintain both patience and vigilance. The U.S.–China tariff issue remains in flux, and the current threat of a 100% tariff increase could yet be softened—or even withdrawn—through ongoing negotiations. Nevertheless, until the outcome becomes clear, companies should prepare for both scenarios: remain alert but not alarmed and ensure that practical response plans are in place to minimize potential disruption if policy changes suddenly. We will continue to monitor developments closely and provide timely updates and analysis as new official information emerges. Should you have any questions or require further assistance, please feel free to contact us.
References:
[1] [2] [3] [4] [5] [15] [16] Trump announces extra 100% tariff on Chinese goods starting next month - CBS News
https://www.cbsnews.com/news/trump-china-tariff-extra-100-november/
[6] [7] [12] [13] [14] 46. | August 11, 2025 | Reciprocal Tariffs on China Remain at 10% until November | Thompson Coburn LLP
https://www.thompsoncoburn.com/insights/reciprocal-tariffs-on-china-remain-at-10-until-november/
[8] Bessent says U.S.-China talks ongoing despite Beijing’s sharp rhetoric | Fox Business
[9] [10] [11] United States Finalizes Section 301 Tariff Increases on Imports from China | White & Case LLP
[17] Further Modifying the Reciprocal Tariff Rates – The White House
