US–Brazil tariff war: the 25% Section 301 tax and what Monday's talks could change
Q: What is the Brazil tariff in 2026?
A: The US imposes a 25% Section 301 additional duty on most goods of Brazil, effective 12:01 a.m. ET July 22, 2026, with more than 1,600 exempt HTSUS subheadings — about 1,200 standard carve-outs plus roughly 430 civil-aircraft lines. Section 232 articles (steel, aluminum, copper, autos, wood, semiconductors) pay the 50% Section 232 rate only; a separate 12.5% forced-labor duty stacks for non-exempt goods, up to 37.5% combined. US-Brazil virtual talks are set for August 31.
Key takeaways
- Brazil tariff 2026: 25% Section 301 additional duty on most goods of Brazil, effective July 22, 2026, 12:01 a.m. ET (July 20 was just the Federal Register publication date).
- The exemption annex covers more than 1,600 HTSUS subheadings — ~1,200 standard plus ~430 civil-aircraft lines.
- No stacking with Section 232: steel, aluminum, copper, autos, wood and semiconductors pay the 50% Section 232 rate only.
- The separate 12.5% forced-labor duty does stack — up to 37.5% combined for non-exempt goods.
- Monday, Aug 31: bilateral Rosa–Greer talks; WTO consultations (DS646) are a separate track the US accepted Aug 10.
- Brazil's core argument: the US runs the trade surplus — $14.4B in goods alone in 2025.
Monday's talks: what's on the table
Brazil's Minister Márcio Elias Rosa and USTR Jamieson Greer meet virtually Monday, August 31 — confirmed by Brazil's ministry on August 27. It is the first formal negotiation since the duty took effect, set after the August 21 Lula–Trump call (80 minutes; the leaders' first since the tariff was announced) in which both sides agreed to resume talks.
The WTO track is separate: Brazil filed dispute consultations on July 28 (case DS646, circulated July 30), arguing the duties breach the MFN principle, exceed Brazil's bound rates, and amount to unilateral sanctions. The US accepted consultations on August 10; China asked to join the same day.
Brazil's agenda, from the minister on July 30: expand the exemptions, cut rates, and reassess the merits of the US decision. Nothing is agreed yet — any change needs USTR action and applies prospectively.
The 25% Section 301 tax: what it is and when it took effect
The action comes from a Section 301(b) investigation opened July 15, 2025 into Brazilian digital-trade, tariff, IP, ethanol, and deforestation practices. The June 1, 2026 determination proposed 25% on all goods of Brazil with exemptions; parties filed over 360 written submissions and 77 witnesses testified at the July 6–7 hearing.
The final action, announced July 15, 2026, imposes "25 percent tariffs on all imports of Brazil, with certain exemptions." The Federal Register notice published July 20 (91 FR 137), and the duty applies to products entered for consumption on or after 12:01 a.m. ET July 22, 2026. A now-expired in-transit window (HTS 9903.05.02) covered goods loaded before that time and entered by July 29.
| Date | Event |
|---|---|
| Jul 15, 2025 | Section 301(b) investigation opens |
| Jun 1, 2026 | Determination; 25% proposed on all goods of Brazil with exemptions (FRN June 4) |
| Jul 15, 2026 | Final action: 25% on all imports of Brazil, with exemptions |
| Jul 20, 2026 | Federal Register notice published (91 FR 137) |
| Jul 22, 2026 | Duty effective 12:01 a.m. ET (in-transit window to July 29) |
| Jul 28, 2026 | Brazil requests WTO consultations (DS646) |
| Aug 10, 2026 | US accepts; China asks to join |
| Aug 31, 2026 | Rosa–Greer virtual talks scheduled |
Context: the action replaces the 50% IEEPA-based levies the Supreme Court struck down in February — PIIE calls it "the first test case" of the post-IEEPA tariff strategy.
Section 301 Brazil goods list: the exemption annex
The exemption annex covers more than 1,600 HTSUS subheadings — about 1,200 standard exemptions plus roughly 430 lines limited to civil aircraft uses (HTS 9903.05.05, General Note 6). The final action kept the exemptions proposed in June and added categories — organic honey, pig iron, unflavored instant coffee, seafood, hides and leather, iron and steel scrap, used clothing, aluminum hydroxide, and antiques and art — while pulling back high-purity dissolving pulp and non-pharma chemical uses. Note the scope markers: "Ex" means only the described product; "Pharma" and "Aircraft" lines are use-limited.
What's exempt from the 25%
- Agri-food: coffee (all forms, incl. unflavored instant), beef, orange juice, cocoa, Brazil nuts and tropical fruit
- Energy & materials: iron ore, petroleum and coal, pig iron, scrap, certain wood products, hides/leather
- Pharmaceuticals (HTS 9903.05.06) and civil aircraft and parts (~430 lines, HTS 9903.05.05)
- Other: organic honey, seafood, used clothing, antiques/art
What still pays the 25%
The covered side is concentrated in machinery, electrical equipment, granite, gold, tires, sugar, and apparel (PIIE). How much is actually hit is disputed: Brazil's minister says about 18% of Brazil's exports to the US; PIIE estimates roughly 34% — the rest spared by the exemption annex (44%), Section 232 (13%), and special provisions (9%). Non-exempt goods file under HTS 9903.05.01 on top of MFN. See the full picture in our US tariff rates 2026 by country guide.
Steel and aluminum pay 50% — not 75%
Articles already subject to Section 232 tariffs — steel, aluminum, copper, autos, wood products, and semiconductors (HTS 9903.05.07) — are excluded from the 25% action entirely. The duties do not stack, so Brazilian steel and aluminum keep paying the 50% Section 232 rate only.
The separate 12.5% forced-labor Section 301 duty (Brazil among ~60 economies; it replaced the 10% Section 122 baseline around July 24) does stack — up to 37.5% combined per PIIE.
Why Brazil says the US has no case: the trade surplus
Brazil's central argument is that the US runs a trade surplus — "it sells more than it buys." US government data supports it: US goods exports to Brazil were $54.3 billion in 2025 against $39.9 billion in imports — a $14.4 billion goods surplus, up 115.7% year over year — plus a $27.4 billion services surplus. President Lula has cited a cumulative $424.5 billion US goods-and-services surplus over 15 years as proof the tariffs lack justification.
What Monday's talks could change
- Exemption expansion or a rate cut. That is Brazil's stated agenda, and USTR may modify or terminate the action under Section 307(c) of the Trade Act — Monday is where that would start. Importers should review the tariff exclusion and drawback process now.
- WTO litigation continues. DS646 consultations are underway; China's participation raises the stakes, and without a functioning Appellate Body an adverse finding could go unresolved for years.
- Status quo. No rate change has been announced as of August 28, 2026. Until USTR acts, the 25% duty (plus the 12.5% stack where it applies) governs every entry.
FAQ
Q: What is the Brazil tariff in 2026?
A: A 25% Section 301 additional duty on most goods of Brazil, effective July 22, 2026, with 1,600+ exempt HTSUS subheadings; a 12.5% forced-labor duty stacks for non-exempt goods (up to 37.5%). Section 232 goods pay the 50% Section 232 rate only.
Q: Is the Brazil tariff effective July 20 or July 22, 2026?
A: July 22, 2026 at 12:01 a.m. ET, for entries on or after that time. July 20 was the Federal Register publication date (91 FR 137).
Q: What's on the Section 301 Brazil goods list?
A: The duty applies to all imports of Brazil with exemptions; affected categories are concentrated in machinery, electrical equipment, granite, gold, tires, sugar, and apparel — roughly 18% (minister) to 34% (PIIE) of Brazil's exports.
Q: Which Brazilian goods are exempt from the 25% tariff?
A: Coffee, beef, orange juice, cocoa, Brazil nuts and tropical fruit, iron ore, petroleum and coal, pharmaceuticals, civil aircraft (~430 lines), pig iron, organic honey, seafood, wood, hides and leather, iron and steel scrap, used clothing, and antiques and art.
Q: Do Brazilian steel and aluminum pay the 25% Section 301 tariff?
A: No — Section 232 articles are excluded and the duties do not stack; Brazilian steel and aluminum pay the 50% Section 232 rate only.
Q: What could Monday's US-Brazil talks change?
A: Brazil wants a wider exemption list, lower rates, and a reassessment of the case. USTR can modify the action under Section 307(c), and the WTO dispute (DS646) continues in parallel. No rate change is in force as of August 28, 2026.
Related: Tariff news & advisories · 2026 tariff exemption list
Sources (verified Aug 28, 2026): USTR Notice of Action — Brazil Section 301 final action (FRN, July 15, 2026) · USTR press release (July 15, 2026) · USTR Brazil trade summary · WTO — DS646 Brazil dispute request · CNBC (July 16, 2026) · PIIE (July 17, 2026) · Valor International (Aug 21, 2026) · Valor International (Aug 11, 2026) · Valor International (Jul 31, 2026) · Agência Brasil (Aug 27, 2026) · Eurasia Review (Aug 27, 2026) · EY Tax News · Green Worldwide (proposal annex analysis) · TariffStool guide · BDO · Economic Times / Reuters (Aug 24, 2026). Informational summary, not legal or customs advice — consult a licensed customs broker for your specific entries.