Trump announces 100% tariff on imports of branded or patented pharmaceuticals from Oct 1

WASHINGTON - US President Donald Trump on Sept 25 unleashed a fresh round of punishing tariffs on a broad range of imported goods, saying the US will impose 100 per cent duties on branded drugs and 25 per cent tariffs on heavy-duty trucks, among other import tariffs, starting next week.

Tariffs have been a feature of Mr Trump’s second term, with

duties on trading partners ranging from 10 per cent to 50 per cent

and other targeted tariffs on a wide variety of products, casting a shadow over the global economic outlook and paralysing business decision-making.

The new actions are seen as part of the Trump administration’s shift to better-established legal authorities for its tariff actions, given the risks associated with a case before the Supreme Court on the legality of his sweeping global tariffs.

Mr Trump also said he would start charging a 50 per cent tariff on kitchen cabinets and bathroom vanities and a 30 per cent tariff on upholstered furniture, with all the new duties to take effect from Oct 1.

“The reason for this is the large scale “FLOODING” of these products into the United States by other outside Countries,” Mr Trump said on Truth Social of the tariffs on household goods.

The new 100 per cent tariff on any branded or patented pharmaceutical product will apply to all imports unless the company has already broken ground on building a manufacturing plant in the United States, Mr Trump said.

The Trump administration has opened a dozen probes into the national security ramifications of imports of wind turbines, airplanes, semiconductors, polysilicon, copper, timber and lumber and critical minerals to form the basis of new tariffs.

Mr Trump this week announced new probes into personal protective equipment, medical items, robotics and industrial machinery.

Foreign policy tool

Mr Trump has made the levies a key foreign policy tool, using them to renegotiate trade deals, extract concessions and exert political pressure on other countries.

Mr Trump’s administration has been touting tariffs as a significant revenue source. Treasury Secretary Scott Bessent says Washington could collect US$300 billion (S$388 billion) by the end of 2025, more than triple its annual tariff revenue in recent years.

Mr Trump previously imposed national security tariffs on steel and aluminium and derivatives, light-duty autos and parts, and copper.

The Trump administration’s trade deals with Japan, the European Union and Britain include provisions that cap tariffs on specific products such as autos, semiconductors and pharmaceuticals, which means the new higher national security tariffs likely will not raise it above agreed rates.

Mr Trump said the new heavy-duty truck tariffs were to protect manufacturers from “unfair outside competition” and said the move would benefit companies such as Paccar-owned Peterbilt and Kenworth and Daimler Truck-owned Freightliner.

The Pharmaceutical Research and Manufacturers of America opposed new drug tariffs, saying earlier this year that 53 per cent by value of the US$85.6 billion in ingredients used in medicines consumed in the US was manufactured in the US with the remainder from Europe and other US allies.

The US Chamber of Commerce earlier urged the department not to impose new truck tariffs, noting the top five import sources are Mexico, Canada, Japan, Germany, and Finland “all of which are allies or close partners of the US posing no threat to US national security”.

Mexico is the largest exporter of medium- and heavy-duty trucks to the US. A study released in January said imports of those larger vehicles from Mexico have tripled since 2019.

Mr Trump in August had promised to impose new furniture tariffs, saying it “will bring the Furniture Business back to North Carolina, South Carolina (and) Michigan”.

Furniture and wood products manufacturing employment in the US has halved since 2000 to around 340,000 today, according to government statistics.

The US imported about US$25.5 billion in furniture in 2024, up 7 per cent over 2023, with about 60 per cent of those imports coming from Vietnam and China, according to Furniture Today, a trade publication.

Inflation fears

Higher tariffs on commercial vehicles could put pressure on transportation costs just as Mr Trump has vowed to reduce inflation, especially on consumer goods such as groceries.

Tariffs could also affect Chrysler-parent Stellantis, which produces heavy-duty Ram trucks and commercial vans in Mexico. Sweden’s Volvo Group is building a US$700 million heavy-truck factory in Monterrey, Mexico, due to start operations in 2026.

Mexico is home to 14 manufacturers and assemblers of buses, trucks, and tractor trucks, and two manufacturers of engines, according to the US International Trade Administration.

The country is also the leading global exporter of tractor trucks, 95 per cent of which are destined for the US.

“We need our Truckers to be financially healthy and strong, for many reasons, but above all else, for National Security purposes!,” Mr Trump added.

Mexico opposed new tariffs, telling the Commerce Department in May that all Mexican trucks exported to the US have on average 50 per cent US content, including diesel engines.

In 2024, the US imported almost US$128 billion in heavy vehicle parts from Mexico, accounting for approximately 28 per cent of total US imports, Mexico said.

The Japanese Automobile Manufacturers Association also opposed new tariffs, saying Japanese companies have cut exports to the US as they have boosted US production of medium- and heavy-duty trucks. REUTERS