New Delhi, February 22 – The tariffs collected by the US administration from various jurisdictions range from $160-175 billion (with Chinese companies likely paying the highest), and the refunds could be "chaotic," but they would also serve as a psychological deterrent in imposing future tariffs, according to a new SBI Research report.
US President Donald Trump has now raised global tariffs to 15 percent, invoking Section 122 of the Trade Act of 1974, a move that escalates his trade offensive a day after the US Supreme Court struck down much of his earlier tariffs.
According to the report, the court's decision to scrap the tariff structure could create uncertainty going forward, and jurisdictions need to engage in counter-intuitive negotiations to position themselves strategically during the period when the US Congress, with its delicately balanced power, holds the ultimate authority.
"The convergence between inter-sovereign treaties and juristic persons on an effective tariff structure could be chaotic," it argued.
Under the Trade Act, the US President can impose temporary import surcharges (up to 15 percent) or quotas to address US balance of payment issues. This can last up to 150 days, unless Congress extends it through legislation.
The new tariffs include exemptions for goods from Canada and Mexico that comply with the USMCA, as well as specific, already-in-place national security tariffs.
"It is expected that during this time, the Administration will complete investigations and levy tariffs using Section 301 and Section 232," the report stated.
Indian companies, along with the rest of the world, face Section 232 tariffs on steel and aluminum, automobiles, and copper, etc., as this section has not been scrapped.
"It will be interesting to see how trade deals among multiple sovereign entities are interpreted by private, independent legal, artificial, or "juristic" persons (the firms who filed the case and won a favorable judgment for refunds and the scrapping of the tariff structure) and how the shifting dynamics of bilateral relations will impact the landscape," the report concluded.
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