Australia is among the nations set to face 15% tariffs announced by U.S. President Donald Trump over the weekend.
The decision comes after the U.S. Supreme Court ruled that the existing tariff structure was illegal.
Trade Minister Don Farrell said Australia is “not happy” with the announcement.
Here’s what you need to know.
Tariffs
A ‘tariff’ is a tax on imports. It’s applied to foreign-made goods brought into another country, and paid by the importer.
For example: Country A and Country B make the same product. Country A wants its citizens to buy its own version of the product, not Country B’s, so it applies a tariff.
Importers in Country A now pay the tax when they bring in B’s product, and pass on the cost to consumers, making this version of the product more expensive to buy.
Arrangement
Since his second presidency began, Trump has announced a range of tariffs on internationally imported goods, including from Australia.
25% tariffs: Cars, trucks, truck parts, advanced computer chips, and bathroom and kitchen materials.
50% tariffs: steel, aluminium, some copper and copper-containing products.
At a press conference last year, Trump said: “We’ll bring back our industry and we’ll bring back our jobs”.
In 2005, Australia and the U.S. entered a free trade agreement (AUSFTA), meaning many products have zero tariffs.
Since 2025, Trump has introduced tariffs on Australian products including steel and pharmaceuticals (if manufacturers do not have U.S. factories).
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Australia has not charged tariffs on U.S. imports.
Supreme Court
Last week, the majority of the nine Supreme Court justices determined that Trump’s use of tariffs had been unlawful.
The Court determined Trump was not authorised to invoke a certain law, the International Emergency Economic Powers Act (IEEPA), to impose tariffs.
Justice Brett Kavanaugh (appointed by Trump) disagreed with the verdict, and raised concerns that the U.S. “may be required to refund billions of dollars to importers who paid the IEEPA tariffs”.
Announcement
Following the Supreme Court decision, on Friday (local time), Trump announced a new tariff of 10%, to apply to most goods imported to the U.S, regardless of their country or origin.
The tariff was applied under a different piece of U.S. legislation.
Two days later, he increased the tariff to 15%, saying countries had been “ripping the U.S. off for decades”.
The tariff will apply for 150 days, and comes into effect at 12:01am on 24 February (D.C. time).
Response
In a statement, Trade Minister Don Farrell said Australia will “examine all options” in relation to the tariffs that it has “consistently advocated against”.
Farrell told Sky News on Monday that he would discuss the announcement on an upcoming visit to Washington D.C.
“It’s not consistent with the way allies should be treating one another,” he said.
Nationals leader David Littleproud called the move “inflationary,” adding that “the people who ultimately pay for this is the consumer”.
