The new levy will take effect from 2:01pm Friday AEST, replacing the temporary 10% global tariff. Canberra and the Business Council of Australia had formally urged Washington to abandon the measure
The Trump administration has confirmed that a new 12.5% tariff will be imposed on Australian exports entering the United States.
The measure will take effect at 12:01am Friday in the United States, corresponding to 2:01pm Friday Australian Eastern Standard Time.
At the same time, Washington’s temporary 10% global tariff on its trading partners, including Australia, will expire. For Australian goods, however, the levy will not disappear. It will instead rise by 2.5 percentage points.
Australian Objections Rejected
The tariff was first proposed last month following a United States trade investigation into forced labour.
During the consultation period, which ended earlier this month, the Australian government and the Business Council of Australia lodged formal submissions opposing the measure.
Those arguments failed to persuade Washington.
The Office of the United States Trade Representative has now confirmed that the tariff will proceed according to schedule.
Sixty Economies Affected
Australia is not the only country targeted by the new tariff regime.
Imports from another 59 economies will face tariffs ranging from 10% to 12.5%, covering all of the United States’ major trading partners.
The decision confirms President Donald Trump’s continued use of tariffs as a central tool of American economic and trade policy.
Washington argues that the measures are necessary to protect US companies, challenge practices it considers unfair and place greater pressure on foreign exporters.
New Pressure on Australian Exporters
The tariff will make Australian goods more expensive in the US market.
Exporters will need to decide whether to absorb the additional cost, reducing their profit margins, or pass it on through higher prices charged to American importers and consumers.
Either approach could weaken the competitiveness of Australian products against US-made goods or exports from countries receiving more favourable treatment.
The announcement also creates renewed uncertainty for companies that had expected the temporary 10% levy to disappear.
Canberra Faces a Difficult Response
The Australian government must now decide how to respond to Washington’s decision.
Options include continuing diplomatic negotiations, seeking exemptions for specific industries and providing support to businesses most exposed to the tariff.
Australia has traditionally described its commercial relationship with the United States as balanced and supported by a close strategic alliance.
The latest measure demonstrates, however, that political and defence ties do not guarantee preferential treatment under the Trump administration’s trade policy.
Trade War Expands
The 12.5% tariff forms part of a broader restructuring of US commercial relations.
Trump has repeatedly imposed tariffs and threatened further economic measures against both allies and competitors, arguing that the United States must protect domestic manufacturing and reduce its reliance on imports.
For Australia, the new regime begins within hours.
The temporary 10% tariff will formally expire, only to be replaced immediately by a higher levy. Australian exporters now face a new period of pressure as Canberra attempts to limit the economic consequences of Washington’s decision.
ABC source
