In a politically volatile move, President Donald Trump has threatened to impose a sweeping 50% tariff on imports from Brazil, an action that pushes the limits of his executive powers and is presently facing legal scrutiny.
In a letter issued on Wednesday, Trump stated that the drastic tariff was, in part, a response to Brazil’s treatment of former President Jair Bolsonaro.
According to a White House official speaking to Finance Newso, Trump is invoking a law that permits him to exercise emergency economic powers, primarily intended for addressing foreign threats to the United States.
This law, known as the International Emergency Economic Powers Act (IEEPA), is central to an ongoing legal battle concerning Trump’s previous “reciprocal” tariffs currently under review by a federal appeals court.
Trump’s legal team argues that their use of the IEEPA to impose these tariffs is justified as a necessary response to various national emergencies, including what they describe as “America’s exploding trade deficit.”
The White House has yet to provide a response to inquiries regarding Trump’s letter to Brazil, particularly regarding how Bolsonaro’s situation aligns with Trump’s authority under the IEEPA.
While this latest tariff on Brazilian goods may not directly affect the ongoing lawsuit, critics warn that it could diminish the administration’s credibility as Trump continues to pursue an assertive trade policy.
Senator Tim Kaine of Virginia sharply criticized the move, describing Trump’s letter as an elevation of “abuse of power.” Kaine pledged to “use all available means to block these latest job-killing tariffs.”
Senator Ron Wyden, the leading Democrat on the Senate Finance Committee, accused Trump of prioritizing personal grievances over economic stability, asserting that the president’s actions fall well outside his legal authority.
Understanding IEEPA
The IEEPA grants the president certain powers to address national emergencies caused by “any unusual and extraordinary threat” largely originating from abroad.
Previously, in April, Trump had applied the IEEPA when he instituted 10% tariffs on imports from nearly all other countries, singling out several nations for even higher tariffs. His executive order on April 2 not only announced these tariffs but also formally declared a national emergency.
In the associated order, the administration cited foreign trade practices contributing to America’s “large and persistent annual goods trade deficits” as having caused damage to the nation’s “industrial capacity” and “compromised military readiness.”
A week after the announcement, Trump temporarily suspended the increased tariffs amid chaos in global markets.
In late May, a ruling from the U.S. Court of International Trade invalidated the reciprocal tariffs, determining that the IEEPA did not empower Trump to enact them.
The court found that Trump’s claim to “unbounded” tariff-making power surpassed any authority granted under the IEEPA.
However, in June, a panel from the U.S. Court of Appeals for the Federal Circuit halted the implementation of that ruling, pending the outcome of ongoing appeals.
Law professor Ilya Somin, a representative for plaintiffs in the case against the Trump administration, noted that it remains to be seen if Trump’s tariff announcement concerning Brazil will influence the ongoing appeal.
For now, Somin mentioned that the Brazilian tariffs are not included in the current legal challenge, but highlighted that the letter “further underscores the indefensible nature” of Trump’s claim to have near-total discretion over tariff policies.
Trump’s Correspondence with Lula
This week, Trump has initiated a new approach, dispatching individual letters to foreign leaders that establish new tariff benchmarks for their exports to the United States, effective August 1.
So far, Trump has sent nearly two dozen letters containing similar language that condemns trade policies resulting in “persistent” U.S. trade deficits.
In his communication, he asserts, “This Deficit is a major threat to our Economy and, indeed, our National Security!”
However, Trump’s letter to Brazil escalates the rhetoric, explicitly linking the imposition of tariffs to his disapproval of recent political and legal events in the country.
Trump criticized Brazil’s handling of Bolsonaro, who faces trial over allegations related to a coup attempt following his 2022 election defeat.
“This Trial should not be taking place,” Trump stated in the letter addressed to current President Luiz Inácio Lula da Silva. “It is a Witch Hunt that should end IMMEDIATELY!”
In addition, Trump claims the 50% tariff is partially a result of “Brazil’s insidious attacks on Free Elections.” He accused the country of infringing on the “fundamental Free Speech Rights of Americans,” alleging that Brazil’s Supreme Court unlawfully censored American social media entities.
Trump also critiqued Brazil’s trade policies, asserting that the ongoing trade deficits pose a national security risk. However, his assertion conflicts with data indicating that the U.S. maintains a trade surplus of $7.4 billion with Brazil as of 2024, according to the Office of the U.S. Trade Representative.
“He’s either lying or misinformed,” Somin commented regarding Trump’s inaccurate statements. He further contended that trade deficits with partners are not unusual and do not constitute an emergency, adding that such claims are particularly absurd when there is an actual trade surplus.
