Trump threatens 100% import tax on pharmaceutical drugs not manufactured in US
Washington: US President Donald Trump announced that pharmaceutical imports would face a 100 percent tariff unless the companies behind them were actively building plants on American soil, escalating his push for tougher trade measures.
The proposed tax, set to begin on October 1, also extends to other goods: 50 percent on imported kitchen cabinets and bathroom vanities, 30 percent on upholstered furniture, and 25 percent on heavy trucks. Trump said on Truth Social that these actions were necessary, at times citing “National Security and other reasons.”
Tariffs framed as economic cure
Trump has consistently defended tariffs as a way to strengthen domestic manufacturing and cut the budget deficit, dismissing concerns that importers would simply pass the costs on to consumers. “Large Truck Company Manufacturers, such as Peterbilt, Kenworth, Freightliner, Mack Trucks, and others, will be protected from the onslaught of outside interruptions,” he wrote online.
He added that the pharmaceutical tariffs would exempt firms already “breaking ground” or “under construction” with new facilities in the US. What remains uncertain is how the rule might affect companies that currently operate American plants.
In 2024, the United States imported nearly USD 233 billion worth of pharmaceutical and medicinal products, according to Census Bureau data. Any doubling of medicine costs could reverberate through households, insurance systems, and federal programmes such as Medicare and Medicaid.
Warnings of health and economic strain
Pascal Chan, vice president for strategic policy and supply chains at the Canadian Chamber of Commerce, warned of the risks to patients if the tariffs move forward. He cautioned that the measures could lead to “immediate price hikes, strained insurance systems, hospital shortages, and the real risk of patients rationing or foregoing essential medicines.”
Beyond health care, higher import duties on cabinetry could weigh on the housing sector. Already facing high mortgage rates and limited supply, homebuyers may see further price increases as builders grapple with rising costs. The National Association of Realtors noted an 11.7 percent increase in listings this August compared to last year, though the median price for an existing home still stood at USD 422,600.
Inflation concerns resurface
The new round of tariffs comes as the US economy shows mixed signals, a buoyant stock market but slowing job growth and persistent inflation. Federal Reserve Chair Jerome Powell recently warned, “We have begun to see goods prices showing through into higher inflation,” pointing to consumer goods costs as the main driver of this year’s price increases.
Trump has insisted inflation is under control and pressed Powell to resign, arguing that the Fed should cut interest rates. “There’s no inflation,” he told reporters Thursday. “We’re having unbelievable success.”
Yet the data tell another story: consumer prices are up 2.9 percent over the past year, compared with 2.3 percent in April, when Trump first revived broad-based tariffs.
Job losses and political pledges
Despite Trump’s claims that tariffs fuel factory building, federal statistics show otherwise. Since April, US manufacturers have shed 42,000 jobs and construction firms have downsized by 8,000.
Trump did acknowledge the fallout of his earlier trade battles, noting that Chinese retaliatory tariffs had cost American farmers soybean sales. He pledged to redirect tariff revenues to support farmers, echoing aid packages rolled out during his first term.
(With inputs from AP)