Trump May Introduce Plan B: 15% Tariff for 150 Days as Middle Path
On May 30, the Trump administration began working on a new 'Plan B' to maintain high tariffs on imports after a U.S. court ruled that President Trump had misused emergency economic powers. The new plan, reported by the Wall Street Journal, involves implementing a 15% tariff for 150 days under the Trade Act of 1974, followed by more targeted tariffs against unfair trade practices.
Court Ruling Sparks Legal Shift
Last week, a federal appeals court allowed the existing tariffs to remain temporarily while the Trump administration appeals the lower court ruling. However, due to legal uncertainty, the administration is exploring new legal avenues to protect the president’s trade policies.
Trump’s Two-Phase Tariff Strategy
According to sources, the new Plan B involves two phases:
- Phase 1: A 15% temporary tariff for 150 days under Section 122 of the Trade Act of 1974. This provision, never used before, was designed to address trade imbalances.
- Phase 2: Long-term tariffs under Section 301, considered legally stronger and more sustainable.
Although no official announcement has been made, White House Press Secretary Karoline Leavitt confirmed that they are exploring new legal strategies while appealing the court's decision.
Expert Reactions and Legal Foundation
Senior trade advisor Peter Navarro confirmed the administration is considering the two-step plan. He also mentioned the potential use of other trade laws, including the 1930 Smoot-Hawley Tariff Act and national security provisions.
Legal experts told the Wall Street Journal that Plan B would provide a more secure legal foundation than the International Emergency Economic Powers Act (IEEPA), which had never been used to impose tariffs before.
Judicial Rulings and Trade Deal Impact
On May 28, the U.S. Court of International Trade ruled that using IEEPA to impose tariffs for reducing trade deficits was unlawful, stating that the president cannot unilaterally impose tariffs without congressional approval. However, the appeals court on May 29 allowed the tariffs to stay in place temporarily.
Some experts believe the ruling could positively impact a potential trade deal between the U.S. and the European Union, removing a key obstacle in the tariff dispute.