On Tuesday, August 7, the Trump administration announced to go ahead with its plan to impose a 25 per cent tariff on US$16 billion worth of Chinese goods for escalating a trade war with Beijing further.

As per the plan, the new tariff  will come into effect on August 23, on 279 Chinese product lines including electronics, plastic, and railway freight cars. The number of products is lesser this time than the original 284 items proposed on June 15, said the US Trade Representative’s office. 

This tariff is the second round of duties that the US has imposed on Chinese goods in a dispute over technology. This was proposed during a breakdown of trade talks between the Trump administration and Beijing. An initial round of tariff was placed on US$34 billion of Chinese products on July 6.

A week before, the US President had also instructed the Trade Representative Robert Lighthizer to consider more than doubling the duty on additional US$200 billion worth of Chinese imports from 10 per cent to 25 per cent. This is likely to come into effect from September, following a public comment period.

In July, Beijing had also announced its decision to retaliate against these heavy duties by imposing an extra 25 per cent tariff on 545 products from the United States including soybeans, electric cars, orange juice, whiskey, salmon, and cigars.

Last week, China’s Ministry of Finance also threatened the US to place tariffs on additional goods of US$60 million, in case the Trump administration goes through its new tariff plans.