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U.S. Trade Policy Update: New Tariffs on Pharmaceuticals, Heavy Trucks, Furniture, and Home Goods

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U.S. Trade Policy Update: New Tariffs on Pharmaceuticals, Heavy Trucks, Furniture, and Home Goods

Following the U.S. government’s implementation of tariffs on imported foreign goods, on September 25, 2025, the U.S. government announced a new rate of import tariffs for particular products aimed at protecting domestic industries and strengthening national security. The new tariff rates for such particular products took effect on October 1, 2025.

Products and New Tariff Rates

Pharmaceutical Manufacturing

A 100% import tariff has been imposed on branded and patented pharmaceutical products. However, business entities that commit to building or expanding manufacturing facilities in the United States will qualify for exemptions, designed to enhance supply security and promote domestic production.

Generic drugs, which account for nearly 90% of prescriptions in the United States, are 100% excluded from these applied tariffs. These lower-cost alternatives, manufactured primarily in India and China, contain the same active ingredients as brand-name products but only enter the market once exclusivity periods expire.

Nevertheless, health policy experts warn that higher costs for branded or patented medicines could cascade throughout the healthcare system, potentially increasing expenses for patients and insurers, straining hospital budgets, and leading patients to ration or skip treatments—particularly in therapeutic areas where few generic alternatives exist.

Furniture and Home Goods

The newly announced import tariffs also apply to furniture and home-related products, a sector heavily dependent on imports. In 2022, imported furniture accounted for 60% of U.S. sales, including 86% of wood furniture and 42% of upholstered items. Analysts expect the new duties to drive up retail prices, disrupt supply chains, and contribute to inflationary pressures, potentially resulting in higher consumer costs and shortages in specific product categories.

Heavy Trucks

The import tariffs extend to heavy trucks, placing additional pressure on foreign manufacturers competing in the U.S. market. While truck prices have risen more slowly than overall inflation in recent periods, analysts caution that the new measures could reverse this trend, increasing costs for buyers and straining supply chains. The U.S. government has positioned the truck tariffs as a strategic move to strengthen domestic production and protect national security.

Objective of the New Tariffs

The U.S. government has introduced these tariffs with the aim of strengthening domestic production capabilities and reducing dependence on foreign suppliers in sectors it considers essential to economic and national security. The measure concerning pharmaceuticals, in particular, is designed to incentivize companies to expand their manufacturing operations within the United States.

Current Status of the New Tariffs

The U.S. government has announced the new import tariffs via public statements on social media, which indicate that the new tariffs took effect on October 1, 2025. However, there is no official guidance on how these tariffs will align with existing multilateral or bilateral trade agreements, such as the United States-Mexico-Canada Agreement (USMCA) or World Trade Organization (WTO) commitments. Importers should closely monitor announcements from U.S. Customs and Border Protection (CBP) and the Office of the United States Trade Representative (USTR) for detailed compliance instructions.

Recommended Steps to Prepare for the New Tariffs

Importers and other stakeholders should consider the following actions to prepare for the newly announced tariffs:

  1. Verify HTSUS Classifications: Ensure that all covered goods are correctly classified under the Harmonized Tariff Schedule of the United States (HTSUS).
  2. Monitor Official Notices: Track upcoming Federal Register publications to confirm the scope, coverage, and enforcement details of the tariffs.
  3. Evaluate Alternatives: Explore alternative sourcing options or domestic production partnerships where feasible to mitigate potential impacts.
  4. Assess Financial Impact: Analyze potential cost increases and budgetary implications of the new tariffs on business operations, including cash flow and pricing strategies.
  5. Engage Legal and Trade Advisors: Consult with trade compliance experts or legal counsel to ensure a full understanding of regulatory requirements, documentation obligations, and possible exemptions.

Conclusion

The new U.S. import tariffs are designed to support domestic production, strengthen the economy, and enhance national security. While they encourage local industries and reduce reliance on imports, they may also lead to higher prices for consumers. Careful planning and ongoing monitoring are essential to balance the benefits for producers with the potential impact on consumers.

For Thai exporters, staying up to date on these changes is important, as U.S. trade policy shifts can affect supply chains, pricing, and competitiveness in the U.S. market.

Author: Panisa Suwanmatajarn, Managing Partner.

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