Tariffs on Singapore expected to stay unchanged even as Trump imposes new 10% global levies

HOUSTON – Goods from Singapore will face a tariff of 10 per cent, even after the US Supreme Court threw out President Donald Trump’s signature reciprocal tariffs policy in a stunning decision.

The apex court ruled in a 6-3 decision on Feb 20 that the US President does not have the power to unilaterally impose tariffs under the International Emergency Economic Powers Act (IEEPA), the authority Mr Trump had invoked to impose tariffs on nearly every trading partner.

But Mr Trump moved to impose a new 10 per cent global tariff using a different provision of trade law.

Just hours after the landmark ruling, he appeared at a press conference at the White House to criticise the development as “deeply disappointing”.

“I am ashamed of certain members of the court for not having the courage to do what is right for our country. Foreign countries that have been ripping us off for years are ecstatic, and dancing in the streets. But they won’t be dancing for long!” he said.

The justices were “fools and lapdogs” as well as “unpatriotic and disloyal”, he said.

“It is my opinion that the court has been swayed by foreign interests, and a political movement that is far smaller than people would think. But obnoxious, ignorant and loud!”

Mr Trump did not name the “foreign interests” when asked but added: “They have a lot of influence over the Supreme Court, whether it’s through fear or respect or friendships.”

Though disparaging of the court decision, he did not appear shaken by the ruling, which threatens to upend the centrepiece of the trade policy of his second term. He said it would only force him to take a longer route to achieve the same end.

“It is my great honour to have just signed, from the Oval Office, a global 10 per cent tariff on all countries, which will be effective almost immediately,” he said in a subsequent Truth Social post.

The new tariff is being imposed under Section 122 (Trade Act of 1974) which permits temporary import surcharges or quotas to address serious trade deficits. It is a stopgap measure while longer investigations are conducted. The tariffs can be no higher than 15 per cent and last only for 150 days. 

Under IEEPA, a baseline tariff of 10 per cent was charged on goods from Singapore – a US free trade partner since 2004 – under the so-called “Liberation Day” reciprocal tariffs announced by Mr Trump in April 2025.

“Given that Singapore is already subjected to a 10 per cent tariff, things should remain stable,” veteran US trade negotiator Wendy Cutler, who is senior vice-president at the Asia Society Policy Institute, told The Straits Times.

Aside from the baseline tariffs on Singapore goods, different tariffs apply to certain sectors, like pharmaceuticals and semiconductors.

About 75 per cent of Singapore’s semiconductor exports enter the US duty-free or at reduced rates due to exemptions for US data centres, R&D, consumer applications and supply chain buildout. 

Singapore-based pharma companies are subject to a 100 per cent tariff on branded or patented pharmaceutical products unless the company is building a manufacturing facility in the US.

But implementation of the tariff has been delayed.

Mr Trump said he had “great alternatives” to the IEEPA tariffs. 

He named Section 301 (Trade Act of 1974), under which US Trade Representative Jamieson Greer can investigate and remedy unfair trade practices, including through tariffs. These actions are country-specific and do not offer universal coverage.

Mr Trump also mentioned Section 232 of the Trade Expansion Act of 1962 which allows the President to impose tariffs on imports that threaten national security, after an investigation by the Department of Commerce. 

None of these provisions – which entail a slow process to find trade distortions by trade partners – allow for the sweeping, universal tariffs that Mr Trump had imposed under IEEPA.

They will force the US trade policy to be more rule-bound and less idiosyncratic.

Ripples will be felt in South-east Asia, which saw some of the highest reciprocal tariff rates – between 46 per cent and 49 per cent – announced in April 2025.

Some of these were subsequently lowered through negotiated trade deals – such as the ones signed with Indonesia, Malaysia and Cambodia – that also aligned approaches on trade enforcement and efforts to counter transshipment from China.

Businesses will need clarity quickly, given that the court ruling adds uncertainty and confusion to an already complicated trade landscape, said Mr Brian McFeeters, president and chief executive officer of the US-ASEAN Business Council.

“But this is not a deal-breaker for the US-ASEAN economic ties,” he said, describing South-east Asian leaders as deeply pragmatic players who recognise the scale of the US market and the quality and staying power of US investments. 

“There may be some disruption or slower movement on the margins but the broader trajectory – including progress on agreements on reciprocal trade focused on tackling non-tariff barriers – remains firmly intact,” Mr McFeeters told ST.

Mr Trump had also imposed additional tariffs under IEEPA on China, Canada and Mexico tied to fentanyl trafficking concerns. Likewise, India had faced tariffs of around 50 per cent, which included IEEPA tariffs to penalise its purchase of Russian oil, before these were negotiated down to 25 per cent in February.

“Beijing will be delighted to see the Supreme Court invalidate the IEEPA tariffs, which it has condemned as illegitimate and inconsistent with US commitments to the World Trade Organization,” said an analysis from scholars at the Center for Strategic and International Studies (CSIS). The average rate of US tariffs on China, inclusive of IEEPA tariffs, stands at 47.5 per cent.

Dr Marcus Noland, executive vice-president at the Washington-based Peterson Institute for International Economics, noted that the trade deals struck with Japan, South Korea and others were contingent on the threat of the so-called Liberation Day tariffs.

“If those are null and void, then one has to expect that our partner countries will want to vacate the subsequent deals that were, frankly, extortionary,” he said.

The July 2025 trade deal with the European Union, under which its goods are subject to a 15 per cent tariff while US products would enter the European market tariff-free, is likely to come under pressure.

The CSIS analysis said the agreement might collapse and lead to a nullifying of investment commitments of US$600 billion (S$760 billion) by 2029 and purchases of US$750 billion worth of natural gas over three years that the Trump administration has presented as major successes.

Ms Cutler, the trade negotiator, said walking away from the deals announced in recent months does not seem to be on the cards for US partners.

“They know all too well that such a step could end up leaving them in a worse position with the White House,” she said.

Even after the IEEPA tariffs were struck down, US businesses could continue paying the tariffs for days or weeks until they are officially notified about changes in the tariffs. The US is also likely to face demands for massive refunds to importers, which some estimates say could run to about US$175 billion.

Treasury Secretary Scott Bessent said his estimates show that the use of Section 122 authority, combined with potentially enhanced Section 232 and Section 301 tariffs, will result in “virtually unchanged tariff revenue in 2026”.

The tariff ruling appears to be popular; a YouGov survey of 1,931 US adults on Feb 20 found that 60 per cent approved of the Supreme Court striking down Mr Trump’s tariffs.