Sri Lanka Among 17 Economies Facing 10% US Tariff Under Section 301 Action

COLOMBO (News 1st); Sri Lanka has been included among a group of economies facing new tariffs imposed by the United States under a sweeping trade action announced by the administration of President Donald Trump over concerns relating to the enforcement of bans on goods produced with forced labour.

The Office of the United States Trade Representative (USTR) announced that Ambassador Jamieson Greer, acting at the direction of President Trump, had taken final action under Section 301 of the Trade Act of 1974 by imposing tariffs on 60 economies for what the USTR described as their failure to impose and effectively enforce prohibitions on the importation of goods produced with forced labour.

The decision follows a series of investigations launched by the USTR, which included two rounds of public hearings, more than 2,100 public comments and consultations with trading partners aimed at addressing the issue.

"President Trump recognizes that decades of moral suasion have not eradicated forced labor from global supply chains. The United States has had a forced labor import ban for nearly a century, and rigorously enforces it; it's well past time for our trading partners to do the same," Ambassador Greer said.

"Today's action will begin to correct what is both a human rights abuse and distortive trade practice to improve the welfare of workers everywhere. I am encouraged by the trading partners who have moved quickly to adopt forced labor import prohibitions, and look forward to ensuring their effective enforcement," he added.

The USTR said the investigations were initiated on March 12, 2026, following specific directions from President Trump and focused on whether economies had failed to impose and effectively enforce bans on imports produced through forced labour.

Public hearings were held in April, while consultations were conducted with more than 45 governments whose economies were subject to investigation. On June 2, 2026, the USTR determined that the policies and practices of the 60 economies under review were unreasonable and imposed a burden on US commerce, making them actionable under Section 301 of the Trade Act.

Following that determination, the USTR proposed trade measures and invited public feedback. More than 1,600 written submissions were received, while additional public hearings were conducted from July 7 to July 9, featuring testimony from over 100 witnesses.

Under the final determination, Sri Lanka has been placed in a category that will be subject to a 10 percent Section 301 tariff rate. The same rate will also apply to Argentina, Bangladesh, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Pakistan, Trinidad and Tobago and the United Kingdom.

According to the USTR, the 10 percent tariff category applies to economies that have already imposed a forced labour import prohibition, committed to implementing and enforcing such measures through reciprocal trade agreements, or adopted partial regimes aimed at preventing the importation of certain forced labour-produced goods.

The USTR also announced separate tariff arrangements for selected products originating from the European Union, Taiwan, Japan, South Korea and Switzerland, while all other investigated economies will face a 12.5 percent Section 301 duty.

At the same time, the United States has approved a number of product exemptions, including certain raw materials, products that could create economy-wide disruptions if subjected to tariffs, goods that cannot be produced in sufficient quantities within the United States, and selected products from certain economies where exemptions are intended to encourage stronger enforcement of forced labour import prohibitions.