Staying on top of the US tariff changes in 2025

They’re on, they’re off, they’re on again, they’re coming…The imposition of tariffs on imported goods and services was a central plank of US President Donald Trump’s 2024 election campaign.

Since coming to office on January 20, he’s acted quickly, imposing tariffs on Mexico, Canada and China, three of the country’s major trading partners. They’ve been paused and reinstated a couple of times since the initial announcement on 1 February and how and where they’ll eventually land is still somewhat unclear.

Tariffs are coming down the pike for EU nations too and they’re already in place for some Australian exporters. February 10 saw the issue of a proclamation imposing a 25 per cent ad valorem tariff on steel and aluminium products from most countries, including our own.

Farm products are also in the forty-seventh’s president’s sights, with tariffs slated to start coming into effect in April.

For anyone who’d managed to miss the memo, the President’s address to a joint session of Congress on 4 March doubled down on this posture around tariffs, whether imposing new tariffs or retaliating to tariff salvos from other countries.

Getting to grips with ongoing uncertainty

For Australian producers selling to our pals across the Pacific, or hoping to start doing so, changes to the US tax regime have significant implications.

For starters, some exporters may not have the capacity to absorb an additional impost of 25 or even 10 per cent. Maintaining margins is likely to mean raising prices and that could reduce demand for their wares stateside – just as tariffs are intended to do.

Whether it remains an attractive or even viable market will be the $64 million question.

From fashion retailers whose threads could be less appealing to US shoppers if they were to come with larger price tags, to resources companies whose offerings may be rendered uncompetitive, we can expect to see export businesses crunching their numbers and conducting scenario planning to inform their decision making.

Compounding the challenge of planning for a range of ‘what if’ taxation scenarios is the fact that export businesses must be prepared to respond to whatever changes come their way, at the drop of a hat.

Getting things wrong could have significant financial and compliance implications, with the possibility there’ll be little lenience extended to businesses that fail to calculate and remit the appropriate fees and tariffs to Uncle Sam on the nail.

Tools to make the task easier

That’s why it makes sense to develop a proactive cross border trade strategy and tax compliance plan to help you get it right – one that will set your business up to respond effectively to new taxes and charges, even if they continue to be announced and implemented at today’s blistering pace.

Investing in automated tax technology can help simplify and streamline all aspects of cross-border compliance, in addition to U.S. sales tax compliance – including registration, licensing, calculation, returns, and document management.

Once it’s implemented in your back office, you’ll have the ability to calculate a wide range of indirect taxes in real time, including US import duties and applicable sales taxes.

Building a successful export business in the age of uncertainty

With a GDP of close to $US30 trillion, the US is an extraordinarily attractive market for growth-focused Australian businesses and it’s likely to remain so for many, changes to its tariff and tax regime notwithstanding.

Adding an automated tax compliance platform to your tech stack will allow you to keep selling to US customers with confidence, secure in the knowledge that the charges you’re required to pay won’t be compounded by avoidable non-compliance costs. If you’re serious about staying in the game, it’s an essential investment you can’t afford not to make.

Chris Calverley, head of sales and partnerships – ANZ at Avalara