Tariffs Imposed on Chinese Exports by the U.S. Temporarily Lifted - Imported goods from China continue to evade US tariffs
In a significant development, the US-China trade tariffs have been partially suspended, with a 10% reciprocal tariff on Chinese imports remaining in effect as a baseline. This suspension and the extended 90-day tariff truce aim to stabilize trade relations and supply chains while negotiations continue towards a more lasting agreement.
As of August 2025, the tariffs on Chinese goods are capped at 30% for US tariffs on Chinese imports, and 10% for Chinese tariffs on US goods. This suspension delays an earlier planned surge that could have raised US tariffs on Chinese goods up to 145% and China's retaliation up to 125%.
The recent 90-day extension of the tariff truce, signed on August 11, provides short-term relief to supply chains, particularly for US retailers preparing for the critical year-end sales period, helping to avoid economic disruption. The extension also maintains pressure on China with the 10% baseline tariff, which supports domestic production and protects US workers.
The truce reflects ongoing negotiations between the US and China, focusing on trade reciprocity, market access, intellectual property, and national security. Recent talks, such as those held in London and Stockholm, have been described as constructive but did not yet yield a final agreement.
The extension fosters an environment for a potential Trump–Xi summit later in 2025 to advance more permanent trade solutions. However, tariffs continue to contribute to elevated consumer prices in the US, with an average effective tariff rate near historic highs (about 18.6%), causing estimated household income losses due to higher prices.
Meanwhile, the legal dispute over the tariffs is ongoing. An appeals court in the US is holding a hearing on the legality of many of Trump's tariffs.
The US has accused China of deliberately withholding certain raw materials, including rare earths used in the production of smartphones, displays, and semiconductors. In response, China has imposed tariffs of 125% on US imports and implemented export controls on strategically important raw materials.
Trump aims to use tariffs to encourage companies to move their production back to the US, while China is using the ongoing trade talks to negotiate access to advanced AI chips from the US.
In conclusion, the current US-China tariffs are in a partial suspension with a 10% tariff baseline maintained, and the 90-day tariff truce extension aims to stabilize trade relations and supply chains while talks continue towards a more lasting agreement. The legal dispute over the tariffs could continue and ultimately end up before the US Supreme Court.
