In his first day in office, President Trump issued a slew of Executive Orders (EO), including one postponing the imposition of any immediate new tariffs that most were expecting on “Day One.” The “America First Trade Policy” EO instead postponed until at least February 1 the proposed 25% tariffs on goods imported from Canada and Mexico and postponed any other tariffs indefinitely pending multiple reviews of assorted trade-related issues by many departments, agencies, and officials of his new administration. All of these reviews generally have a deadline of April 1, with that date now marking a “bright line” for the assessment of new tariffs under various trade remedy and other statutes.

In essence, President Trump’s EO instructed the identified agencies and officials to conduct a complete “top-to-bottom” review of U.S. trade policy covering numerous issues to establish “a robust and reinvigorated trade policy that promotes investment and productivity, enhances our Nation’s industrial and technological advantages, defends our economic and national security, and – above all – benefits American workers, manufacturers, farmers, ranches, entrepreneurs, and businesses.”

In remarks accompanying the new EO, President Trump essentially deferred any action on the universal 10% tariff that was to apply to imports into the U.S. from all countries. “We may. But we’re not ready for that yet” was the President’s statement on this issue, one of major concern to the EU and all of the U.S.’ top trading partners. The President also indicated that he wanted to reverse the persistent trade deficit with the EU, either through tariffs or more exports of U.S. energy.

One of the highlights of the EO called for the feasibility of establishing and implementing a new External Revenue Service (ERS) that would collect tariffs and other trade-related revenue. Currently, tariffs are paid by the U.S. importer of record (not the foreign producer, exporter, or country) and collected by U.S. Customs & Border Protection (CBP), whose revenue collection function remained within the Treasury Department after all of CBP’s other functions were transferred to the new Department of Homeland Security in 2003 created after the attacks of 9/11. Although the theory behind this proposal seems to be that foreign countries should be paying U.S. customs duties on goods exported from those countries to the U.S., some countries (like the U.S.) prohibit taxes of any kind (including customs duties) from being levied on exports.

Another highlight concerned the contentious issue of de minimis shipments, i.e., those imported into the U.S. via special entry procedures for goods valued under $800, thus exempting them from any duty or import-related fees. While the focus of the EO is on counterfeit goods and illicit drugs, many unscrupulous global traders use these procedures to evade payment of duties on legitimate imports of merchandise (such as apparel and footwear) that would otherwise be subject to some of the highest Normal Trade Relations duties of any category of merchandise when imports are valued at over $2,500 and formal entry procedures are required.

Key Provisions of the EO

Insight

Now that President Trump has issued this sweeping EO, it is clear that tariff increases may be part of the solution his administration enacts—perhaps with congressional approval via legislation or via Presidential Proclamations issued under a variety of trade remedy or other statutes.

With the new April 1 deadline looming, companies should be taking immediate measures to prepare for any coming changes. By understanding the legal mechanisms available and proactively adopting strategic measures, companies can navigate these challenges and seize opportunities in a rapidly evolving global market.

Written by Damon V. Pike, Mathew Mermigousis and James Pai. Copyright © 2025 BDO USA, P.C. All rights reserved. www.bdo.com