U.S. floats 100% tariffs on chips, drugs

President Donald Trump imposed 100% tariffs on certain branded pharmaceutical imports on April 2, while the U.S. kept separate semiconductor tariff machinery in motion. (usnews.com) (whitehouse.gov) The pharmaceutical tariffs came through a Section 232 national-security proclamation after a Commerce Department investigation found imported patented drugs and ingredients threatened U.S. supply resilience. (whitehouse.gov) The White House said companies that sign both U.S. manufacturing agreements and Most Favored Nation pricing deals with the Department of Health and Human Services can get a 0% rate. Companies that only onshore face 20%, and companies that do neither face 100%. (whitehouse.gov) (usnews.com) Large drugmakers have 120 days before the top rate takes effect, and smaller producers have 180 days. Imports from the European Union, Japan, South Korea, Switzerland and Liechtenstein are capped at 15%, while Britain has a separate lower-tariff arrangement. (whitehouse.gov) (usnews.com) Generic drugs and biosimilars are excluded for now, and the White House said it will reassess them in a year. The administration said orphan drugs, animal-health drugs, and some urgent public-health products can also qualify for exemptions. (whitehouse.gov) The administration tied the move to lost tariff revenue after the Supreme Court struck down many of Trump’s earlier emergency-powers tariffs in February. Reuters reported the new drug duties were meant in part to rebuild those collections. (usnews.com) That court ruling is now rippling through small businesses and parcel carriers. Alexandra Fine, cofounder of Dame Products, said she repaid customers after Customs opened a refund portal in April and is now trying to recover the money from the government. (businessinsider.com) Fine said Dame added a tariff surcharge last year after its China-based production costs jumped, then saw “huge cart abandonment” at checkout. She said shifting production out of China was not practical because silicon molds used in the company’s products were hard to source elsewhere. (businessinsider.com) FedEx, United Parcel Service, and DHL have said they will pursue refunds for overturned International Emergency Economic Powers Act tariffs and pass money back to customers. Customs told importers the first phase covers entries finalized since January 30, with payments expected in about 60 to 90 days. (businessinsider.com) The split is the point: some tariffs are being unwound through refunds, while Section 232 duties on strategic sectors are being expanded and hardened. For importers, the next fight is no longer whether tariffs exist, but which legal lane Washington uses to keep them. (businessinsider.com) (whitehouse.gov)