Legislative Update: Trump Imposes Global Reciprocal Tariffs with Increases on Key Trade Partners

Trump Imposes Global Reciprocal Tariffs with Increases on Key Trade Partners  

President Donald Trump announced his sweeping reciprocal tariff plan that imposes a global 10 percent tariff on all imports, with significantly higher rates of up to 50 percent on dozens of countries with the most restrictive trade practices. These elevated tariffs, determined by foreign tariffs on U.S. goods and non-tariff barriers, include 34 percent on China, 46 percent on Vietnam, and 49 percent on Cambodia, among others. The plan expands on previously implemented tariffs targeting Canada, Mexico, China, and various industrial imports and coincides with the activation of 25 percent tariffs on all imported autos and parts. Trump framed the move as necessary to counter longstanding trade imbalances and protect American industries. However, the broad inclusion of both major and developing economies could heighten global trade tensions and provoke retaliatory measures.

President Trump has reiterated his call for companies to relocate production to the United States to avoid newly announced tariffs. These tariffs, like earlier trade measures imposed during his administration, are being implemented under the International Emergency Economic Powers Act (IEEPA) of 1977. Trump has declared the U.S. trade deficit a national emergency, citing its long-term impact on domestic manufacturing, supply chains, and the defense-industrial base. According to the executive order, persistent trade imbalances are attributed to unequal tariff structures, foreign non-tariff barriers, and policies by trading partners that suppress wages and consumption while artificially boosting the competitiveness of their exports.

The tariffs are scheduled to take effect on April 9 and will remain in place until the President determines that the trade deficit and underlying inequities have been sufficiently addressed. Notably, the tariffs will not apply to imports already covered by Section 232 measures, including steel, aluminum, autos, and auto parts, nor will they apply to items under consideration for future Section 232 tariffs, such as semiconductors, pharmaceuticals, and certain natural resources unavailable domestically. The executive order also warns that retaliatory actions from other nations may trigger further tariff increases, even though many key trading partners have already signaled plans to respond.

Despite the President’s efforts, some Republicans expressed unease about economic repercussions and using emergency powers for trade policy, particularly for trade-dependent and border states. Senate Majority Leader John Thune (R-SD) acknowledged his state’s reliance on exports but also emphasized the need for fairer trade agreements.  Furthermore, many Republicans have shown a widening policy rift on international economic engagement, with implications for U.S.-Canada relations and broader global trade dynamics as the administration continues to pursue a confrontational trade agenda.

Senate Votes to End National Emergency Imposing Tariffs on Canadian Imports

The Senate approved a resolution (S.J.Res 37) by a 51-48 vote to end the 25 percent tariffs imposed on Canadian imports under national security grounds, signaling a rare bipartisan rebuke of President Donald Trump’s trade policy. Four Republican senators—Mitch McConnell (R-KY), Susan Collins (R-ME), Lisa Murkowski (R-AK), and Rand Paul (R-KY)—joined Democrats in support of the measure, arguing that Canada, unlike Mexico and China, is not a major source of fentanyl and should not be penalized. In response, President Trump publicly criticized the resolution and its Republican supporters while vowing to block it, stating the House would not advance it and he would not sign it into law.

The policy has drawn opposition from Congressional Democrats, labor unions, industry groups, and agricultural organizations who have expressed concern over the economic impact of the new tariffs. They argue that the measures could drive up consumer prices and risk triggering a recession.

Senate Prepares to Advance GOP Budget as Reconciliation Groundwork Begins

On April 3, Senate Budget Chairman Lindsey Graham (R-SC) released a revised budget blueprint to advance a comprehensive reconciliation package that includes permanent tax cuts, increased defense and border security funding, and a substantial boost to the debt ceiling. The proposal reflects a compromise with the House and retains elements of both chambers’ earlier resolutions. Notably, while the plan expresses a preference for at least $2 trillion in spending cuts over the next decade, it provides flexibility to scale back that target to meet the Senate’s Byrd rule requirements for reconciliation legislation.

The blueprint provides fiscal space for more than $5.2 trillion in tax reductions, including making the 2017 tax cuts permanent and introducing new provisions favored by President Donald Trump, such as exempting tips and overtime pay from income taxation. It also raises the Federal debt limit by up to $5 trillion, a move intended to give the Treasury sufficient capacity through the 2026 midterm elections. The budget maintains key funding allocations: up to $150 billion in new defense spending, $175 billion for border enforcement, and $20 billion in Commerce Committee-directed spending, largely for the Coast Guard.

President Trump has fully endorsed the Senate plan, urging Republicans to pass it immediately. The revised Senate proposal will be presented as an amendment to the House-adopted budget resolution (H. Con. Res. 14), signaling a unified legislative path forward.

Senate Majority Leader John Thune (R-SD) is expected to initiate debate on the revised GOP budget resolution with a procedural vote on April 3, setting in motion up to 50 hours of debate and a subsequent amendment marathon, or “vote-a-rama,” likely beginning late March 4. The resolution, which requires only a simple majority to pass, is projected to clear the Senate over the weekend.  If approved by the Senate, the House is scheduled to consider the measure next week before its April recess. Once both chambers adopt the resolution, committees will have until early May to draft the substantive components of the reconciliation bill. While Senate committees are only required to find $5 billion in savings across five panels, the resolution still reflects a broader GOP aim of securing $2 trillion in cuts over a decade. However, the plan offers flexibility as Republicans work on any ongoing divisions over how deeply to reduce federal spending.

A key element of the Senate proposal is the permanent extension of the 2017 tax cuts, normally costing about $3.7 trillion under traditional scoring. To mitigate that, Senate Budget Chairman Lindsey Graham (R-SC) has adopted a “current-policy baseline,” allowing extensions to be treated as cost-neutral.  Despite objections by Democrats, Thune told senators they do not need a ruling from the Senate parliamentarian to use this scoring tactic, asserting that the Budget Committee chair has the authority to set the baseline under the 1974 Budget Control Act. This marks a strategic pivot that could allow Republicans to bypass certain procedural hurdles and fast-track the resolution.

Some House Republicans are expressing concern over the Senate’s use of a “current-policy baseline” to make the cost of extending the 2017 tax cuts appear deficit-neutral. House conservatives argue that any package must be accompanied by significant spending reductions to avoid further increasing the national debt.  House Ways and Means Committee members have been working to tailor the tax provisions to fit within the $4 to $4.5 trillion framework established by the House-adopted budget resolution. Given the GOP’s narrow House majority, members acknowledged the uncertainty surrounding whether the Senate’s modified plan could pass the lower chamber, noting that the current political landscape is even more challenging than in 2017, when 13 Republicans voted against the original tax overhaul.

House Republicans Weigh Gradual Phaseout of Green Energy Tax Credits 

House Republicans are reconsidering their earlier push to fully repeal clean energy tax credits established under the Inflation Reduction Act (IRA), with House Budget Chair Jodey Arrington (R-TX) now suggesting a more gradual phaseout to avoid significant disruptions to the energy market. While Arrington still views the credits as “wasteful and distortionary,” he acknowledged that a more “thoughtful” transition might be necessary to balance economic impacts and political support. The change in tone follows growing pressure from within the party, as nearly two dozen House Republicans have publicly expressed support for preserving the credits, especially given the investment and job creation benefits in their home districts.

Efforts to offset the cost of extending the 2017 tax cuts have driven Republicans to scrutinize IRA programs for potential savings—however, House Energy and Commerce leaders, including Reps. Brett Guthrie (R-KY) and Bob Latta (R-OH) have found that the actual climate-related savings available for rescission are more limited than anticipated. The Congressional Budget Office (CBO) reportedly provided a disappointing estimate of funds that could be clawed back, partly because much of the money has already been distributed.

Additional political factors GOP leaders must contend with include narrow House margins and the presence of swing-district Republicans who are under pressure from clean energy advocates to preserve popular credits like 45X (clean technology manufacturing) and 45Q (carbon capture). While outright repeal appears increasingly unlikely, changes to eligibility, timelines, or credit structures remain under discussion, signaling that modifications, rather than elimination, may be the GOP’s path forward.

Zelden Announces EPA May Reassign Researchers to Ease Chemical Approval Backlog at Annual ECOS Meeting

During his keynote address at the Environmental Council of the States (ECOS) annual spring meeting on March 25, Administrator Lee Zeldin defended the agency’s proposal to eliminate the Office of Research and Development (ORD). While insisting that no final decision has been made, Zeldin explained that the agency is evaluating a reorganization that would reassign ORD staff to divisions with significant operational backlogs of pending pesticide and chemical approvals.  He pointed to the Office of Chemical Safety and Pollution Prevention (OCSPP), which is facing a backlog of approximately 14,000 new chemical applications under the Toxic Substances Control Act (TSCA).

The potential elimination of ORD, which employs more than 1,500 experts, marks a major shift in the agency’s structure and research priorities. Zeldin emphasized that staff performing duties mandated by Congress will be retained while questioning the value of positions not tied to statutory obligations.

Administrator Zeldin also reiterated his commitment to “cooperative federalism” as a core principle of the agency’s Powering the Great American Comeback initiative and underscored the importance of state-level authority and collaboration in implementing federal environmental statutes.  He asserted that past administrations have too often centralized control in Washington.

Zeldin listed key regulatory priorities, including reforming the permitting process, updating regulations for PFAS (“forever chemicals”), revising safe drinking water standards, and enhancing the agency’s emergency response capabilities in communities affected by recent environmental incidents such as those in East Palestine, Ohio, and Los Angeles.

As part of his commitment to shared governance, Zeldin announced EPA’s final rule granting West Virginia Class VI primacy under the Safe Drinking Water Act—empowering the state to oversee underground drinking water protections. He also cited structural reforms within the agency, such as reinstating the Science Advisory Board and Clean Air Scientific Advisory Committee, as steps toward a more balanced and transparent regulatory process.

Senate EPW Chair Addresses Spending Reductions, Eyes Changes to TSCA and Permitting Rules at ECOS Meeting

Senate Environment and Public Works Committee Chair Sen. Shelley Moore Capito (R-WV) also spoke at the ECOS meeting on March 25, where she expressed uncertainty and concern surrounding federal spending cuts, particularly in the environmental regulatory space. Capito acknowledged that the budget reductions under the Trump administration’s Department of Government Efficiency (DOGE) have exposed some inefficiencies but has also affected some necessary and functional programs. She urged state regulators to remain patient as these changes settle and expressed cautious optimism that the system could be made more efficient.

Capito also voiced concern over the impact of funding freezes on state and federal agencies, especially in light of the IRA’s targeted climate grants, which have been scaled back significantly. She highlighted the Infrastructure Investment and Jobs Act (IIJA) as more stable, noting that she considers its funding secure through its 2026 expiration.

On chemicals oversight, Capito reaffirmed EPA’s leadership role in regulating “forever chemicals” such as PFAS and emphasized her support for bipartisan legislation to shield “passive receivers” from liability under Superfund rules. She also indicated her committee may consider amending the Toxic Substances Control Act (TSCA) within the next two years. While she has not yet coordinated closely with EPA Administrator Lee Zeldin on PFAS-related policy, Capito left open the possibility of engagement depending on the administration’s direction. Additionally, she signaled that permitting reform for energy projects remains a key priority.

Federal judge halts EPA’s Cancellation of $20 Billion in Climate Grants

A federal judge has temporarily blocked the EPA from canceling over $20 billion in climate grants awarded under the Biden administration, citing a lack of supporting evidence for the agency’s claims of waste and fraud. The decision comes in response to a lawsuit filed by several grant recipients who argued that the EPA’s abrupt termination of the awards violated statutory and constitutional protections. The grants were part of the Greenhouse Gas Reduction Fund, created under the 2022 Inflation Reduction Act (IRA) to facilitate climate-focused financing through public-private partnerships.

EPA Administrator Lee Zeldin halted the grants earlier this year and formally canceled them on March 11 due to broad concerns over program integrity, fraud, and misalignment with current agency priorities. The EPA claimed that the $20 billion had been inappropriately “parked” at Citibank, which was serving as the financial intermediary to distribute the funds. However, Judge Tanya Chutkan found that the EPA’s termination letters lacked detailed justification and failed to offer individual explanations or evidence of wrongdoing. During a court hearing, EPA legal counsel admitted they were unaware of specific findings and referenced only media reports. The Judge also emphasized that the grant recipients had been awarded funds under a congressionally authorized statute and were not given an opportunity to respond to the termination.

No IRIS Act Advances as EPA Faces Pressure to Reform Unverified Risk Assessments

The Trump administration is intensifying its efforts to streamline government and eliminate inefficiencies, including an executive order to revoke regulations lacking explicit congressional authorization. As part of this initiative, EPA Administrator Lee Zeldin announced 31 deregulatory actions to reduce consumer costs, boost domestic energy production, and restore U.S. automotive jobs. A central target of these reforms is the EPA’s Integrated Risk Information System (IRIS) program, which critics argue is unauthorized, inefficient, and lacks scientific transparency.

The IRIS program has long faced scrutiny. It remains on the Government Accountability Office’s (GAO) “High-Risk” list due to chronic delays—often exceeding a decade per assessment—and concerns about scientific rigor. Critics contend that IRIS findings frequently contradict global standards and provoke unnecessary alarm, jeopardizing essential chemical uses in defense, healthcare, infrastructure, and energy sectors.

On January 27, over 80 industry groups wrote a letter (which was signed by the Vinyl Institute) petitioning the EPA to reform or eliminate IRIS, and Congress has responded with the No IRIS Act (S. 623, H.R. 1415), introduced by Sen. John Kennedy (R-LA) and Rep. Glenn Grothman (R-WI), which would block EPA’s use of IRIS assessments in regulatory decisions. The administration views eliminating the IRIS program as necessary to align regulatory decision-making with sound science, appropriate oversight, and clearly delegated authority. Proponents argue this change will reduce bureaucratic waste and better support American economic priorities.

EPA opens exemption portal as Trump targets Clean Air Act rules

EPA has launched a new portal allowing companies to request presidential exemptions from nine Clean Air Act regulations. This move provides companies with a streamlined process to seek relief from environmental rules that President Trump could waive if deemed based on unavailable technology. The exemptions would apply to several industry regulations, including power generation, chemical manufacturing, and sterilization.

The action coincides with the administration’s broader rollback of Biden-era environmental protections, including restrictions on mercury emissions and the use of ethylene oxide—a chemical linked to cancer. While the EPA has stated that exemption requests will be reviewed on their merits and are not guaranteed approval, opponents argue that the move circumvents formal rulemaking and undermines public health protections.