China Warns Of Retaliation As Trump Unveils New Tariff Plan

He said all IEEPA-related tariffs will be canceled from Tuesday. But courts will decide in the coming years whether previously paid tariffs, about US$130 billion, will be refunded. Trump is set to visit Beijing in early April to meet with Chinese President Xi Jinping.

In the short run, Chinese exporters will enjoy a 5% reduction in duties, as the 20% IEEPA-based tariffs on China will be replaced by a 15% temporary tariff.

Chinese commentators initially welcomed the US Supreme Court ruling as a symbolic victory, viewing it as a rare institutional constraint on Washington's tariff authority. However, the optimistic mood quickly shifted as analysts realized that the US government retains multiple legal and investigative mechanisms to pursue new trade restrictions.

“The so‐called 'temporary tariffs' recently imposed by the US cite Section 122 of the Trade Act of 1974, a provision rarely used in recent decades, on the grounds of addressing fundamental international balance‐of‐payments problems, particularly the US trade deficit,” says Yuyuan Tantian, a social media account affiliated with China Central Television.

“However, the legal threshold for invoking Section 122 is a fundamental imbalance in overall international payments, including capital flows, trade in services, and goods. From this perspective, the new tariffs could face legal challenges again,” she writes.

“If the US lowers tariff rates, China may assess the situation and make adjustments accordingly,” says Cui Fan, a professor at the School of International Trade and Economics at the University of International Business and Economics.“But if the US uses other legal tools to impose new tariffs, China will also evaluate whether to take corresponding countermeasures.”

A Shandong-based columnist writes in his“Global Watch” commentary that the Trump administration still has at least three legal pathways to impose new tariffs:

. Section 122 of the Trade Act of 1974 - Designed to quickly fill the policy vacuum created by the IEEPA ruling, this measure allows Washington to move rapidly and create a new tariff baseline, signaling to markets and trading partners that US tariff barriers remain in place.

. Section 232 of the Trade Expansion Act of 1962 - This law allows the president to restrict imports on national security grounds, including through tariffs. It was widely used during Trump's first term and again after his return to office to target products such as steel and aluminum. US courts have historically granted the president broad discretion under this provision, making legal challenges more difficult.

. Section 301 of the Trade Act of 1974 - This mechanism authorizes the Office of the US Trade Representative (USTR) to investigate what Washington considers unfair trade practices and impose retaliatory tariffs without congressional approval, giving the administration strong unilateral authority.

“The scope of Section 232 investigations is expected to expand significantly in 2026, targeting strategic sectors such as electric-vehicle (EV) batteries, rare earths and advanced artificial-intelligence chips that are closely tied to national security and future industrial competition,” the writer says.“By framing tariffs under national-security justifications, the administration is trying to build a more durable legal foundation for long-term duties that will be harder to challenge.”

He says US allies such as the EU, Japan and South Korea are increasingly using similar unilateral trade tools, warning that the EU's probe into Chinese EVs signals a potential tit‐for‐tat global tariff cycle.

Cross‐border compliance expert Wang Lei advised companies in China to adopt a“three‐step strategy”:

• Immediately compile proof of duties paid since 2018 and register refund accounts with US Customs and Border Protection;
• closely monitor class‐action cases expected to be heard by the US Court of International Trade; and
• adjust supply chains by shifting part of production to Southeast Asia to avoid potential new tariffs.

Beyond China, several Asian exporters are also expected to benefit from the new 15% temporary tariff rate. Exporters in Malaysia, Cambodia, Pakistan, Indonesia and Thailand had previously faced tariffs of around 19%, while those in Vietnam and Bangladesh paid 20% and India paid 25%.

Some observers said that if the US is set to launch more Section 301 probes against China, more Chinese firms will have to relocate their production facilities to other Asian countries.

At a February 20 press briefing, Trump said the court decision had removed tariff uncertainty. He described the companies that filed the lawsuit as“China‐centric.”