The Donald Trump administration announced on the 1st (local time) that it would pursue a 25% retaliatory tariff under Section 301 of the Trade Act to respond to Brazil's unfair trade practices.

The U.S. Trade Representative (USTR) announced this plan to impose retaliatory tariffs on the same day, Reuters and CNBC reported.

The USTR announced that Brazil has engaged in unfair trade practices in areas such as digital trade, electronic payment services, preferential tariffs, and intellectual property protection, and has signaled that it will impose a 25% retaliatory tariff on a significant portion of imports from Brazil.

However, some items such as beef, coffee, rare earths, other metals, and aircraft parts have been excluded from the retaliatory tariff imposition, Reuters reported.

This retaliatory tariff plan is a measure under Section 301 of the Trade Act.

In a statement, the USTR said that Brazil's trade practices are "unreasonable and burden or restrict U.S. commerce, thus justifying (retaliatory) action under Section 301 of the Trade Act."

Jamie Goslin, USTR Acting Deputy Assistant Secretary, stated that President Trump has had several constructive meetings with Brazilian President Luiz Inácio Lula da Silva regarding tariff issues, but significant differences in opinion remain.

Previously, President Trump had imposed a 50% tariff on Brazilian products using the International Emergency Economic Powers Act (IEEPA) as a retaliatory measure against the leftist Lula government's prosecution of former far-right President Bolsonaro.

However, that tariff was ruled unlawful by a U.S. court in February, and the Trump administration is pursuing a plan to impose new tariffs on major countries using Section 301 of the Trade Act.