Expanded Section 232 Tariffs on Steel and Aluminum

Expanded Section 232 Tariffs on Steel and Aluminum

Expanded Section 232 Tariffs on Steel and Aluminum

Updated May 21, 2025 (IN12519)

Section 232 of the Trade Expansion Act of 1962 (19 U.S.C. §1862, as amended) authorizes the President to impose trade restrictions if the Secretary of Commerce determines that imports of a good "threaten to impair" U.S. national security.

In 2018, President Trump proclaimed a 25% tariff on steel and a 10% tariff on aluminum imports from most trading partners under Section 232. During both the Trump and Biden Administrations, the United States negotiated country exemptions (see Figure 1) and granted entity-specific exclusions as well as General Approved Exclusions (GAEs) applicable to any importer.

On February 10, 2025, President Trump made changes to the Section 232 steel and aluminum tariffs, including the following:

increased aluminum tariffs from 10% to 25%, eliminated all country exemptions, and terminated all existing GAEs effective March 12, 2025;

expanded the tariffs' product coverage; and

prohibited the Commerce Secretary from considering new product exclusions (entity-specific product exclusions to "remain effective until their expiration date or until excluded product volume is imported, whichever occurs first").

Congress may consider possible positive and negative implications of expanded tariffs for the U.S. economy, U.S. relations with trading partners, and issues related to congressional trade authorities.

Background

In 2018, President Trump imposed Section 232 tariffs on steel and aluminum imports after the Commerce Secretary determined that such imports threatened to impair U.S. national security by "weakening" the U.S. internal economy. In 2020, President Trump expanded the tariffs to include certain derivatives of steel and aluminum articles. The Biden Administration largely maintained these tariffs and, in 2023, increased tariffs on Russian aluminum imports to 200% in response to Russia's war on Ukraine.

In response to the Section 232 tariffs, various trading partners implemented retaliatory tariffs against U.S. exports, some of which were suspended after negotiations. The Trump Administration granted Australia, Canada, and Mexico full exemptions while other partners received exemptions after negotiating import quotas. In 2022, the Biden Administration granted a temporary tariff suspension to Ukraine, which was extended to June 2025.

Figure 1. Section 232 Steel and Aluminum Country Exemptions

As of February 2025

Source: CRS, from various presidential proclamations.

February 2025 Presidential Proclamations

President Trump stated that he terminated country exemptions and product exclusions for steel and aluminum tariffs because such measures "undermine" the tariffs' objectives, such as achieving U.S. capacity utilization rate targets. President Trump also cited concerns about increased U.S. steel and aluminum imports from exempted countries, other countries legally or illegally avoiding tariffs by investing in and exporting through exempted countries (sometimes called "transshipment"), and product exclusions granted to a "significant volume of imports." In the proclamation on steel imports, President Trump claimed a lack of "sufficient action" by exempted partners "to address non-market excess capacity caused primarily by China, or sufficient cooperation ... on issues like trade remedies and customs matters or monitoring bilateral steel trade."

The February 2025 proclamations significantly expanded the scope of derivative steel and aluminum articles subject to the Section 232 tariffs (see Table 1). According to 2024 data from the U.S. Census Bureau, the 2020 Proclamation covered derivative products worth $457 million in U.S. imports (not accounting for country exemptions or product exclusions), while the February 2025 proclamations list derivative products worth $150 billion in U.S. imports. For most derivative products, tariffs apply only to the steel or aluminum content and do not apply to derivative products processed abroad using steel or aluminum originally "melted and poured" (steel) or "smelted and cast" (aluminum) in the United States. U.S. Customs and Border Protection (CBP) has issued instructions on reporting steel and aluminum content in derivative products. A good can be subject to both steel tariffs and aluminum tariffs. Section 232 tariffs are applied in addition to:

Most-favored nation (MFN) tariffs, which are imposed on goods from trading partners without a U.S. free trade agreement (FTA) or which do not meet FTA rules;

Trade remedies;

20% tariffs on China;

Tariffs under Section 301 of the Trade Act of 1974;

The 10% universal tariffs implemented on April 5 and higher country-specific rates (suspended until July) do not apply to steel and aluminum products covered by Section 232 tariffs. Executive Order 14289 specified that steel and aluminum tariffs do not apply to goods subject to Section 232 automotive tariffs or 25% tariffs on Canadian and Mexican goods.

The expanded steel and aluminum tariffs went into effect on March 12 without any exemptions (tariffs on Russian aluminum remain at 200%). Some previously-exempted partners have announced retaliatory measures. On March 13, Canada implemented 25% tariffs on C$29.8 billion ($21 billion) worth of U.S. imports. The European Union (EU) voted to reimpose previously-suspended retaliatory tariffs and impose a second tranche of tariffs. EU measures are currently suspended until July 14 to allow for U.S.-EU negotiations.

Some U.S. industry groups and Members of Congress praised the tariff actions. Other industry groups and Members expressed concerns about the impact on U.S. companies and the imposition of tariffs on allies. Some observers contend the U.S. tariffs and potential foreign retaliation could have negative effects on U.S. consumers and producers. In 2023, as directed by Congress, the U.S. International Trade Commission (USITC) analyzed the economic impacts of the Section 232 steel and aluminum tariffs from 2018 to 2021. USITC found that the tariffs reduced steel and aluminum imports by 24% and 31%, respectively. USITC also found that the tariffs increased the U.S. market price of steel products by 2.4% and aluminum products by 3.6%.

Issues for Congress

Congress might consider the potential benefits and costs of expanded steel and aluminum tariffs for the U.S. economy, relations with trading partners including global discussions on overcapacity, and whether these actions are consistent with U.S. international trade obligations.

Congress may also consider whether to support or curb presidential authorities related to Section 232. Some Members of Congress advocate for expanding presidential trade authorities (e.g., H.R. 735). Others assert that Congress should play a stronger role in approving U.S. trade actions (e.g., S. 348, S. 1272/H.R. 2665, H.R. 1903). Some Members have called for tariff exemptions for certain products or countries, like those previously in place, to mitigate potential impacts on the U.S. economy.

Table 1. U.S. Steel and Aluminum Imports Potentially Subject to Expanded Section 232 Tariffs

2024 annual data; millions of U.S. dollars

Partner

Value ($ mil.)

% Share Total Imports

Partner

Value ($ mil.)

% Share Total Imports

Steel

Steel Derivatives

Canada

$7,169.5

23%

China

$15,076.8

28%

European Union

$6,832.0

22%

Mexico

$8,042.9

15%

Mexico

$3,499.9

11%

European Union

$7,405.3

14%

South Korea

$2,923.9

9%

Canada

$5,577.3

10%

Brazil

$2,911.1

9%

Taiwan

$3,518.4

7%

Japan

$1,704.8

5%

South Korea

$2,668.8

5%

Taiwan

$1,317.5

4%

India

$2,511.6

5%

Vietnam

$1,129.8

4%

Vietnam

$2,025.1

4%

China

$798.1

3%

Japan

$1,627.0

3%

India

$493.3

2%

Thailand

$1,183.0

2%

All Others

$2,719.8

9%

All Others

$3,963.6

7%

Total Steel Imports

$31,499.5

100%

Total Steel Derivative Imports

$53,599.8

100%

Aluminum

Aluminum Derivatives

Canada

$9,438.5

51%

Mexico

$22,890.3

22%

European Union

$1,548.5

8%

China

$21,820.2

21%

United Arab Emirates

$1,147.3

6%

European Union

$13,054.4

13%

China

$818.9

4%

Canada

$11,959.0

12%

South Korea

$803.0

4%

South Korea

$5,864.5

6%

Bahrain

$605.7

3%

Japan

$5,419.5

5%

Argentina

$492.8

3%

Taiwan

$4,781.4

5%

India

$448.6

2%

Vietnam

$3,956.5

4%

Mexico

$396.9

2%

United Kingdom

$2,160.7

2%

South Africa

$393.4

2%

Thailand

$2,005.7

2%

All Others

$2,432.5

13%

All Others

$8,754.2

9%

Total Aluminum Imports

$18,526.1

100%

Total Aluminum Derivative Imports

$102,666.4

100%

Source: CRS. General imports data from the U.S. Census Bureau (accessed via Trade Data Monitor) using Harmonized Tariff Schedule product codes listed in Proclamations 9704 and 9705 of March 8, 2018; 9980 of January 24, 2020; and 10895 and 10896 of February 10, 2025.

Notes: According to Proclamations 10895 and 10896 of February 10, 2025, for derivative products, Section 232 tariffs are to apply only to the steel or aluminum content of the derivative product and would not apply to derivative products processed in other countries using steel or aluminum that was "melted and poured" (steel) or "smelted and cast" (aluminum) in the United States. Also note, the lists of steel derivative products and aluminum derivative products contain some duplication (totaling approximately $6.5 billion in 2024 imports).