Brazil Signals Retaliation Over New US Tariff

Brazilian President Luiz Inácio Lula da Silva announced that his government will enact reciprocal trade measures in response to the United States’ decision to raise tariffs on Brazilian imports to 50%. The move follows Brazil’s recent adoption of a law allowing for proportionate countermeasures in trade disputes.

“Please understand that the 50% number is far less than what is needed to have the Level Playing Field we must have with your Country,” Trump wrote in the letter. “And it is necessary to have this to rectify the grave injustices of the current regime.”

The tariff hike, set to take effect on Aug. 1, was confirmed in a letter from US President Donald Trump. He framed the decision as a reaction to what he called an "unfair trade relationship" with Brazil and the ongoing prosecution of former Brazilian President Jair Bolsonaro, an outspoken Trump ally.

Unlike similar letters recently sent by Trump to over 20 world leaders announcing new tariffs, the message to Lula goes further, directly citing Brazil’s domestic legal proceedings as a reason for the increased rate. Trump called Bolsonaro’s trial for his alleged involvement in an attempted coup after the 2022 election “a Witch Hunt,” echoing rhetoric he has used to describe his own legal challenges in the United States.

Lula firmly rejected the tariff decision and its underlying political motivations. “Brazil is a sovereign country with independent institutions that will not accept being lectured by anyone,” he posted on social media. He confirmed that Brazil will respond in accordance with its economic reciprocity law.

In the same letter, Trump accused Brazil of infringing on free elections and freedom of speech, apparently referring to a recent Brazilian Supreme Court ruling that could hold social media platforms liable for user content. 

He also claimed Brazil’s trade practices have created “unsustainable trade deficits” that threaten the US economy and national security. However, official US data contradicts that claim. According to the Office of the United States Trade Representative, the US recorded a US$7.4 billion goods trade surplus with Brazil in 2024.

Trump also announced the launch of an investigation into Brazil’s trade practices, particularly concerning digital trade and the treatment of US tech companies.