President Trump Issues EO to Update the “Annex II” List of Imports Exempt from Reciprocal Tariffs and Establish Procedures for Implementing Trade Deals:

On Sept. 5, President Trump issued an executive order (EO), “Modifying The Scope of Reciprocal Tariffs and Establishing Procedures for Implementing Trade and Security Agreements,” as well as an associated Fact Sheet. While the Trump administration continues to reject calls for a formal tariff exclusion process, this EO provides insight into how the administration will consider and implement targeted tariff relief.
 
This new EO updates Annex II, first issued alongside the original reciprocal tariff EO. Imports on this updated list will be exempt from reciprocal tariffs as well as the additional tariffs targeting India and Brazil beginning on Sept. 8. According to the White House Fact Sheet, the update adds “bullion-related articles and certain critical minerals and pharmaceutical products subject to pending Section 232 investigations” and removes “certain aluminum hydroxide, resin, and silicone products.” Products that no longer appear on the list will be subject to tariffs beginning on Sept. 8.
 
This EO also creates a new Annex III (located below Annex II on the link above). This “Potential Tariff Adjustments for Aligned Partners” (PTAAP) Annex includes a list of products for which the administration will “consider” reducing the reciprocal tariffs to zero based on the agreements that various trading partners reach with the United States. As a result, imports of listed products will likely receive reciprocal tariff relief for some trading partners but not others. According to the EO, this annex is intended to contain products that “cannot be grown, mined, or naturally produced in the United States or grown, mined, or naturally produced in sufficient quantities in the United States to satisfy domestic demand; certain agricultural products; aircraft and aircraft parts; and non-patented articles for use in pharmaceutical applications.”
 
Finally, this new EO also indicates that President Trump might be willing to modify “sectoral” or “reshoring” tariffs imposed under Section 232 in certain circumstances depending on numerous factors, including the scope and economic value of a trading partner’s commitments to the United States in its agreement on reciprocal trade.

President Trump Issues EO to Implement the U.S.-Japan Trade Agreement:

On Sept. 4, President Trump issued an executive order (EO) to implement the U.S.-Japan trade agreement. The president previously announced that the United States and Japan had reached a deal ahead of the Aug. 1 reciprocal tariff deadline. Japanese imports will be subject to a 15% tariff, including any existing duties, and apply retroactively to goods entered for consumption or withdrawn from warehouse for consumption on or after 12:01 a.m. EDT on Aug. 7, 2025. This rate is a decrease from the proposed 25% duty that President Trump threatened to levy on Japan.
 
The agreement notably provides Japan exemptions from the U.S. sectoral-specific tariff regime, which has largely remained separate from the U.S. reciprocal tariff regime levied under IEEPA. Japanese automotive exports will be subject to a 15% tariff as opposed to the 25% tariff in effect on most nations. This was a top priority for Japanese negotiators as they sought to reach an agreement with the United States. Japan will remain subject to other Section 232 tariffs on steel, aluminum, and copper; however, goods covered under the World Trade Organization Agreement on Trade in Civil Aircraft, except unmanned aircraft, will be subject to the lower 15% IEEPA rate, exempting steel, aluminum, and copper content from the higher Section 232 duties. Additionally, Japanese “natural resources unavailable (or unavailable at sufficient scale to satisfy domestic demand) in the United States, generic pharmaceuticals, generic pharmaceutical ingredients, and generic pharmaceutical chemical precursors” will be exempt from U.S. tariffs entirely, meaning these products will be exempt from the 15% base rate, as well as any future Section 232 tariff levied on pharmaceuticals.
 
In exchange, Japan agreed to increase imports of key American goods, including agricultural products, automobiles, commercial aircraft, defense equipment, and energy. Japan will also invest $550 billion in the United States, which President Trump says will be used to expand domestic manufacturing.

President Trump Threatens to Impose Furniture Tariffs:

On Aug. 22, President Trump released a social media statement warning that he will soon impose tariffs on furniture imports. He stated that a “major tariff investigation on furniture” is underway, which will be completed in the “next 50 days.” He did not define “furniture,” making it unclear what items would be impacted by the future tariff. The president also did not identify the rate to be assigned to such products or the authority under which the investigation is being conducted.

The imposition of tariffs on imported furniture would disproportionately affect the hospitality sector by significantly increasing procurement costs and causing potential delays in essential renovations or openings. Additionally, China is the world’s largest producer of furniture, and its economy would be disproportionately impacted by any future tariff, which could further complicate U.S.-China trade negotiations.