Laura Gamba Fadul
16 July 2026•Update: 16 July 2026
The Brazilian government condemned a new round of US tariffs on its exports, threatening immediate economic retaliation and escalation to the World Trade Organization (WTO) in a move that looks to fracture strained ties ahead of Brazil's October presidential election.
Trump administration announced Wednesday a blanket 25% tariff on certain Brazilian goods entering the US, effective July 22. The decision follows a trade investigation by the Office of the United States Trade Representative (USTR), which concluded that Brazil’s commercial policies are structurally unfair to US interests.
The government of President Luiz Inacio Lula da Silva swiftly fired back, branding the protectionist measure “an act without economic justification.” Brasilia announced it would invoke its domestic "Reciprocity Law" to slap equivalent, penalizing tariffs on incoming US products.
“Brazil will immediately begin the procedures necessary to invoke the mechanisms provided for under the reciprocity law ... and will also pursue the matter through the World Trade Organization’s dispute settlement mechanism,” said the presidential office.
The presidency rejected the USTR's claims of unfair trade practices, claiming an existing commercial imbalance favoring Washington. Lula said in 2025 that a staggering 76% of all US imports entered Brazil completely duty-free and assured that the average effective tariff applied to American goods in Brazil was 3.1%.
Last year, US exports to Brazil outpaced imports by nearly $42 billion, marking Washington's third-highest global trade surplus, behind only the Netherlands and the United Kingdom.
"Brazil does not recognize the legitimacy of investigations that are not grounded in the multilateral rules governing international trade," Lula added.
To safeguard domestic industries and curb immediate inflation, the White House order carves out specific Brazilian commodities that the US does not produce in high volumes or that are vital to American supply chains, including coffee, beef, oranges, orange juice and aerospace components.
US Secretary of State Marco Rubio took to American social media company X to claim that the tariffs were a direct consequence of Lula putting “his own ego ahead of making a deal” and failing to negotiate in good faith.
Lula has placed the blame squarely on the family of his predecessor, Jair Bolsonaro. The trade war between the two leaders originally ignited in July 2025, when the Trump administration levied an aggressive 50% tariff on Brazilian goods, citing a perceived "witch hunt" against Bolsonaro, who was convicted for his role in an attempted coup following his 2022 electoral defeat. While some of the initial 2025 tariffs were later rolled back, the latest 25% penalties mark a sweeping escalation.
The economic tensions are growing as Brazil is gearing up for its pivotal presidential election in October. Lula is expected to run for re-election in a highly polarized race against conservative Sen. Flavio Bolsonaro, the son of the former president.
