SUPPLEMENTARY INFORMATION:

I. Background

At the specific direction of the President, on July 15, 2025, the Trade Representative initiated an investigation under Section 301(b) of Trade Act into acts, policies, and practices of Brazil related to digital trade and electronic payment services; unfair, preferential tariffs; anti-corruption enforcement; intellectual property protection; ethanol market access; and illegal deforestation. USTR published a Federal Register notice announcing the initiation of this investigation. 90 FR 34069 (published July 18, 2025). On June 1, 2026, the Trade Representative determined that certain of Brazil's acts, policies, and practices at issue in this investigation are actionable under Section 301(b) and Section 304(a) of the Trade Act; proposed to determine that action is appropriate and that appropriate action would include tariffs on all goods of Brazil, with certain exemptions; and invited comments from the public. USTR published a Federal Register notice setting out these determinations and proposals. 91 FR 33854 (published June 4, 2026) (the June 4, 2026 FRN).

The June 4, 2026 FRN invited public comment on the proposed action in the investigation: applying tariffs of 25 percent on all goods of Brazil, with exemptions for certain goods, including informational materials, donations, accompanied baggage, all articles and parts of articles subject to tariffs under Section 232 of the Trade Expansion Act of 1962, and certain products identified in the Annex to the June 4, 2026 FRN (the June 4, 2026 Annex). As explained in the June 4, 2026 FRN, the proposed exemptions included: (a) raw materials that, if subject to the proposed additional tariffs, could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to additional tariffs; (c) certain products that cannot be grown or produced in sufficient quantities in the United States or obtained from other sources; and (d) articles for which additional tariffs may not contribute substantially to the elimination of Brazil's acts, policies, and practices determined to be actionable.

Interested persons were invited to provide comments regarding the scope of tariff coverage (including the proposed excluded products identified in the June 4, 2026 Annex). As stated in the June 4, 2026 FRN, in considering whether certain articles should be subject to additional duties under Section 301 of the Trade Act, USTR will consider the needs of the U.S. economy. In commenting on the inclusion or removal of particular tariff subheadings subject to the proposed action, USTR requested that comments address specifically whether the products under the tariff subheading are necessary raw materials or are available from alternative sources at reasonable prices or sufficient quantities outside of Brazil; whether additional tariffs would cause serious dislocations in the supply of the products and could cause economy-wide disruptions, or other similar factors; and whether imposing additional tariffs on products under the tariff subheading would be practical or effective in obtaining the elimination of Brazil's acts, policies, and practices. USTR also invited views on U.S. engagement with Brazil in the context of the ongoing Special 301 review (19 U.S.C. 2242) and the subjects of that engagement.

In response to the notice of proposed action, interested persons filed over 360 written submissions. USTR and the Section 301 Committee held a two-day public hearing on July 6-7, 2026. During the hearing, 77 witnesses provided testimony and responded to questions. The public submissions are available at: https://comments.ustr.gov/​s/​ at docket numbers USTR-2026-0331 and USTR-2026-0397. Transcripts of the hearing are available on USTR's website.

II. Determination on Appropriate Action

On June 1, 2026, the Trade Representative determined that certain acts, policies, and practices under investigation are unreasonable or discriminatory and burden or restrict U.S. commerce, and thus are actionable under Section 301(b) of the Trade Act. Section 301(b) provides that upon determining that the acts, policies, and practices under investigation are actionable and that action is appropriate, the Trade Representative shall take all appropriate and feasible action authorized under Section 301(c), subject to the specific direction, if any, of the President regarding such action, and all other appropriate and feasible action within the power of the President that the President may direct the Trade Representative to take under Section 301(b) to obtain the elimination of that act, policy, or practice. Section 301(b) provides further that actions “within the power of the President” may include “[a]ctions . . . with respect to trade in any goods or services, or with respect to any other area of pertinent relations with the foreign country.”

Section 301(c) of the Trade Act authorizes the Trade Representative to take certain, specific actions for purposes of carrying out the provisions of Section 301(b). For example, Section 301(c)(1)(B) authorizes the Trade Representative to “impose duties or other import restrictions on the goods” of the foreign country subject to the investigation. Section 301(c)(3)(A) provides that actions that the Trade Representative is authorized to take may be taken against any goods or economic sector on a non-discriminatory basis or solely against the foreign country concerned. Section 301(c)(3)(B) empowers the Trade Representative to take actions against any goods and economic sector “without regard to whether or not such goods or economic sector were involved in the act, policy, or practice that is the subject of such action.”

USTR and the Section 301 Committee have carefully reviewed the public comments and testimony regarding the proposed action. The Trade Representative informed the President ( printed page 45517) of his proposed responsive action, including a 25 percent tariff on the products of Brazil, with exemptions for certain goods. The Trade Representative also advised the President that, after considering significant comments and testimony on the proposed action, certain products warranted exemption from the tariff imposed in connection with this action as they are (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil determined to be actionable in the investigation. The Trade Representative also advised the President that he has continued to consult with the Government of Brazil to obtain the elimination of these acts, policies, and practices, but those consultations have not satisfactorily resolved U.S. concerns.

On July 15, 2026—after considering and taking account of the information and advice provided by the Trade Representative; the information, findings, and determinations in the June 4, 2026 FRN; the need to obtain the elimination of the acts, policies, and practices of Brazil found to be actionable; and other pertinent information—the President issued a memorandum (Memorandum) directing that:

(a) The Trade Representative shall impose a tariff of 25 percent on all goods of Brazil, with exemptions for certain goods as discussed in subsection (b) of this section.

(b) The Trade Representative shall exempt from the tariff directed in subsection (a) of this section the products identified in the Annex to this memorandum. I determine that each of these products constitutes (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not materially contribute to the elimination of the acts, policies, and practices of Brazil found to be actionable in the investigation described above. After weighing the relevant considerations, including potential economic harm and efficacy of tariffs, I determine that the products identified in the Annex to this memorandum shall be exempted from the tariff directed in subsection (a) of this section.

The Memorandum further directs that in the President's judgment, the tariff of 25 percent on all goods of Brazil, with the exemptions for certain goods as discussed in Section (1)(b) of the Memorandum, is appropriate and feasible to obtain the elimination of the acts, policies, and practices of Brazil found to be actionable under Section 301. The Memorandum also states the President's determination that alternatives to the action directed by the President, such as a lower tariff rate, negotiation without the imposition of tariffs, and action under other statutory authority without action under Section 301 of the Trade Act, would be less effective and less preferable than the action directed in the Memorandum. In the President's judgment, the specific direction in the Memorandum is consistent with the purposes of Section 301 of the Trade Act. The Memorandum will be published in the Federal Register .

Considering the public comments and testimony, and the advice of the Section 301 Committee, pursuant to Sections 301(b) and 304(a) of the Trade Act, the Trade Representative has determined that action is appropriate in this investigation. In accordance with the specific direction of the President, and considering the public comments and testimony, and the advice of the Section 301 Committee, the Trade Representative has determined pursuant to Sections 301(b), 301(c), and 304(a) of the Trade Act that appropriate and feasible action in this investigation is the application of tariffs of 25 percent to all imports of Brazil, with certain exemptions as detailed in Annex I and II to this notice. Exempting these products is appropriate as each of these products constitutes (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil found to be actionable in the investigation.

Any product of Brazil that is subject to the additional duty imposed by this action, and that is admitted into a U.S. foreign trade zone, except any product that is eligible for admission under “domestic status” as defined in 19 CFR 146.43, only may be admitted as “privileged foreign status,” as defined in 19 CFR 146.41, effective as of the date that the additional duty is imposed.

III. Responses to Significant Comments

The Trade Representative has determined to exempt all of the products proposed for exemption in the June 4, 2026 Annex, except high-purity dissolving pulp and the non-pharmaceutical applications of certain products proposed for exemption. Further, the Trade Representative has determined to exempt additional products, including aluminum hydroxide; antiques, collectibles, and art; ash containing precious metals or precious metal compounds; certain animal hides, furskins, and leather; certain seafood products; certain additional pharmaceuticals and pharmaceutical ingredients; certain wood products; iron and steel waste and scrap; organic honey; pig iron; unflavored instant coffee; and used clothing. The Trade Representative has determined not to exempt certain products requested for exemption from the tariffs. For these products, the Trade Representative determined that exemption from the tariffs was not warranted.

Below, USTR responds to comments on the proposed action that raise significant issues.

A. Discussion of Comments on the Proposed Exemption List

USTR received a variety of comments on the proposed exemption list, including support for the products included on the proposed exemption list and requests to remove certain products from the proposed exemption list. These comments are discussed below.

Support for products on the proposed exemption list. A number of comments expressed support for maintaining certain proposed exemptions. Numerous commenters, including in the animal nutrition, automotive, electrical, medical equipment, and wood sectors, expressed support for maintaining the proposed exemptions from Section 301 tariffs for products that are subject to Section 232 tariffs. These commenters noted that the absence of such an exemption could increase capital costs for utilities, and this exemption helps avoid duplicative tariff treatment. With respect to medical equipment, commenters noted that an exemption for products subject to Section 232 tariffs would avoid tariff complexity and unintended harm.

Numerous commenters also expressed support for maintaining the exemptions proposed for products and industries such as aluminum oxide, wood and wood products, dietary supplements, oranges and orange inputs, iron ore ( printed page 45518) pellets, and stone. Commenters supporting these proposed exemptions, such as with respect to iron ore pellets, certain types of wood and wood products, and aluminum oxide, asserted an insufficiency of supply from U.S. or other non-Brazilian sources. Comments related to wood and wood products noted that many species native to Brazil are unique tropical woods that cannot be grown domestically or in other countries. Such comments also noted that species grown in Brazil have unique attributes that satisfy particular performance, safety, or structural requirements, such as fire ratings, durability, or moisture resistance, and thus could not easily be substituted for other species. Another reason given for supporting these proposed exemptions, such as for certain stone products and high-purity dissolving pulp, was that imports of these products contribute to investment in the United States and U.S. employment.

As noted, considering the public comments and the advice of the Section 301 Committee—and in accordance with the specific direction of the President—the Trade Representative has determined to exempt from this tariff action all of the products proposed for exemption in the June 4, 2026 Annex, except high-purity dissolving pulp and the non-pharmaceutical applications of certain products proposed for exemption, as each of these products constitutes (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil found to be actionable in the investigation.

Determination to remove certain products from the proposed exemption list. Considering the public comments and the advice of the Section 301 Committee—and in accordance with the specific direction of the President—the Trade Representative has determined to maintain the above-referenced, proposed exemptions, but to remove high-purity dissolving pulp from the list of products for which an exemption was proposed and to limit the exemption for certain other products to their pharmaceutical applications.

Regarding high-purity dissolving pulp, USTR received testimony recommending that USTR remove this product from the exemption list, alleging that Brazilian producers of this product benefit from illegal deforestation, which lowers land and input costs relative to the United States. Commenters argued that domestic supply of this product is unreliable, and noted that U.S. sources cannot provide the same variety or quality as other sources. Other testimony asserted, however, that there are limited downstream users of this product, who all have access to alternative domestic supply. Testimony also indicated that applying tariffs on high-purity dissolving pulp would align with the Administration's broader efforts to address unfair trade in such products.

Regarding the limitation of certain proposed exemptions on certain chemicals and chemical products to their pharmaceutical applications, comments supporting proposed exemptions noted the health-related applications of products proposed for exemption such as cellulose, acai preparations, and phosphoaminolipids, and stated that certain ingredients that support U.S. manufacturing of healthcare products are not available in the United States in sufficient quantities to meet domestic demand. Limiting exemptions for these proposed chemical products to their pharmaceutical applications is consistent with the proposal in the June 4, 2026 FRN because an exemption for all applications is broader than necessary to cover goods that have limited availability outside Brazil.

Considering the public comments and the advice of the Section 301 Committee—and in accordance with the specific direction of the President—the Trade Representative has determined to maintain the above-referenced, proposed exemptions, but to remove high-purity dissolving pulp from the list of products for which an exemption was proposed and to limit the exemption for certain other products to their pharmaceutical applications, as high-purity dissolving pulp and the non-pharmaceutical applications of certain exempted products are not (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil found to be actionable in the investigation.

Requests to remove other products from exemption list. Some commenters requested to remove other products from the proposed exemption list or otherwise more broadly advocated for narrowly tailored exemptions. Industries or products for which commenters expressed opposition to proposed exemptions include iron ore pellets, beef, chemical wood pulp, fresh oranges, certain wood products, and chemicals and petrochemicals. Commenters suggested, for example, that beef, wood pulp, and certain wood and wood products are linked to certain acts, policies, and practices found actionable in this investigation, and that exempting these products would fail to hold Brazil accountable for such acts, policies, and practices. There remains limited availability of these products outside of Brazil, however, and Section 301(c)(3)(B) provides that the Trade Representative is authorized to take action against any goods or economic sector “without regard to whether or not such goods or economic sector were involved in the act, policy, or practice that is the subject of such action.”

With respect to iron ore pellets, commenters suggested that production from Brazil had weakened the domestic industry by dictating prices, pointed to recent and anticipated expansion in U.S. production capabilities, and suggested that subjecting imports of this product to tariffs could support investment and employment in the United States. Other commenters argued, however, that iron ore pellets are not presently produced in the United States in sufficient quantities and cannot be obtained from other sources outside Brazil.

Considering the public comments and the advice of the Section 301 Committee—and in accordance with the specific direction of the President—the Trade Representative has determined not to remove products other than high-purity dissolving pulp and the non-pharmaceutical applications of certain products from the proposed exemption list, as these other products do not constitute (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil found to be actionable in the investigation. ( printed page 45519)

B. Determination To Expand the Proposed Exemption List

As noted above, considering the public comments and the advice of the Section 301 Committee—and in accordance with the specific direction of the President—the Trade Representative has determined to exempt from this tariff action all of the products proposed for exemption in the June 4, 2026 Annex except high-purity dissolving pulp and the non-pharmaceutical applications of certain products proposed for exemption, as well as to expand the list to include aluminum hydroxide; antiques, collectibles, and art; ash containing precious metals or precious metal compounds; certain animal hides, furskins, and leather; certain seafood products; certain additional pharmaceuticals and pharmaceutical ingredients; certain wood products; iron and steel waste and scrap; organic honey; pig iron; unflavored instant coffee; and used clothing.

With respect to aluminum hydroxide, commenters noted that the sole U.S. supplier of aluminum hydroxide is unable to meet U.S. demand and that approximately 40 percent of U.S. supply is sourced from Brazil. According to comments, aluminum hydroxide is an essential, non-substitutable raw material used in critical applications such as sanitation of drinking water, production of flame-retardant polymer materials used in defense and industrial applications, production of oil and gas, and refining of aluminum. Companies that use aluminum hydroxide in these and other applications require a stable and cost-effective supply of aluminum hydroxide, including from Brazil.

Regarding ash containing precious metals or precious metal compounds, comments noted that tariffs on these items would not address the acts, policies, and practices at issue and would increase costs and disrupt supply chains for products needed to protect U.S. national security. Brazil is a significant supplier to the United States of ash containing precious metals or precious metal compounds, with more than 50 percent of total imports to the United States of this raw material coming from Brazil.

Comments regarding antiques, collectibles, and art noted that these products are typically not newly produced, and many of them are not products of Brazil. Applying tariffs on these products would not be effective in obtaining the elimination of the acts, policies, and practices of Brazil determined to be actionable in this investigation, and in fact, could increase demand for newly-produced goods, including newly-produced goods from Brazil.

Comments regarding certain animal hides, furskins, and leather asserted that alternative sources of leather are not available at comparable prices, quality, or scale those available in Brazil, and that production could not easily be moved to the United States. Comments also emphasized that these products are manufacturing inputs in a wide range of downstream commercial products, including automotive, furniture, and footwear products. Commenters noted that applying tariffs on these products would undermine the competitiveness of U.S. firms.

With respect to certain seafood products, commenters pointed to catch limits, quotas, and spawning-season closures in the United States as limiting the availability of domestic supply, and noted that imports accounted for about 80 percent of the seafood that Americans ate in 2023. They observed that seafood products imported to the United States from Brazil meet particular demands of commercial sale and consumer preferences, and that restaurants, retailers, and others depend on seafood products compatible with North American consumption to maintain operations.

Regarding requests to exempt additional pharmaceuticals and pharmaceutical ingredients to those proposed in the June 2, 2026 Annex, commenters suggested that these products are ingredients that support U.S. manufacturing and cannot be obtained in the United States. Comments further observed that these products were used for health purposes similar to uses for products already proposed for exemption from tariffs.

With respect to wood products, including certain types of softwood plywood and engineered hardwood flooring, commenters noted that there is limited-to-no domestic availability; that the products are harvested in compliance with Brazilian forestry laws and regulations; and that tariffs would harm U.S. consumers, importers, distributors, and builders, as they are inputs with a wide range of important applications in the construction and industrial sectors. Commenters additionally noted that, while certain unfinished tropical-wood inputs were proposed to be exempted, the finished wood products were not, and suggested that this would simply shift costs to U.S. value-added products, while not providing a meaningful incentive for Brazil to change its conduct. Commenters also noted that, with respect to certain wood products and other sectors, stacking Section 301 tariffs on top of Section 232 tariffs would not contribute to security, offer little additional policy benefit, and instead would disrupt supply chains and raise consumer costs. While other comments advocated for the application of tariffs on certain plywood products, arguing that such products may be derived from illegally deforested timber or timber sourced from Brazilian tree plantations containing non-native species that have contributed to illegal deforestation, such comments do not address the potential impacts of tariffs on consumers or the domestic availability of these products.

With respect to iron and steel waste and scrap, comments noted that this product is similar to other products that were proposed to be exempted from tariffs applied pursuant to this action. Like other products already proposed for exemption, iron and steel waste and scrap is an important input for carbon and alloy steel production, and there is no viable domestic supply for this product.

Regarding organic honey, commenters assert that there is almost no domestic production of organic honey despite demand, noting that U.S. production satisfies only 3 percent of annual domestic demand, while as much as 80 percent of U.S. imports of organic honey is sourced from Brazil. Commenters further explain that domestic production of organic honey cannot easily be increased given requirements for large quantities of pesticide-free land and native vegetation that does not exist in the United States, as well as the unique natural disease-resistance of Brazilian bee varieties. Commenters suggest that organic honey is a non-substitutable input for many downstream, processed products.

With respect to pig iron, historically, more than 95 percent of domestic pig iron production is consumed internally by U.S. integrated steel producers, meaning that iron foundries (like electric arc furnace steel producers) are reliant on imported pig iron. Commenters also noted that other third-country sources of pig iron were limited given that China consumes virtually all of the pig iron it produces, and supply from Russia and Ukraine has been affected by the Russia-Ukraine war. Commenters also stated that pig iron is an essential raw material for iron foundry operations, and it is melted and mixed with scrap iron and other alloys to produce cast iron. They observed that there is no substitute for pig iron, and that additional tariffs on pig iron imports would exacerbate competition they already face from imports of ( printed page 45520) downstream products. In contrast, some commenters advocated for tariffs on pig iron—suggesting that the United States has the raw materials and production capacity to replace imported pig iron from Brazil. However, very little domestically produced pig iron is currently sold in the U.S. market, so imports from Brazil are important to satisfy U.S. demand.

Comments regarding unflavored instant coffee observed that Brazil is the largest producer globally of coffee, including bulk, unflavored instant coffee, and that unflavored instant coffee is not available from domestic sources (emphasis added). These comments also maintained that alternative sources of supply cannot reliably replace the volume of unflavored instant coffee that Brazilian producers supply to the United States due to factors including the inability to meet technical specifications required by U.S. manufacturers. Commenters also noted that the June 4, 2026 Annex proposed to exempt flavored instant coffee from tariffs; contended that there is no rationale for treating flavored and unflavored instant coffee differently; and argued that treating these products differently could create market distortions (emphasis added).

With respect to used clothing—as with antiques, collectibles, and art—comments noted that these products are typically not newly produced, and often are not products of Brazil. Applying tariffs on these products would not be effective in obtaining the elimination of the acts, policies, and practices of Brazil determined to be actionable in this investigation, and in fact, could increase demand for newly-produced goods, including newly-produced goods from Brazil.

Accordingly, the Trade Representative has determined to add aluminum hydroxide; antiques, collectibles, and art; ash containing precious metals or precious metal compounds; certain animal hides, furskins, and leather; certain seafood products; certain additional pharmaceuticals and pharmaceutical ingredients; certain additional wood products; iron and steel waste and scrap; organic honey; pig iron; unflavored instant coffee; and used clothing to the list of products exempted from tariffs imposed in connection with this investigation. These products constitute (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil found to be actionable in the investigation.

C. Commenter Requests for Additions to the Exemption List

USTR received numerous comments requesting that additional products be added to the exemption list and exempted from tariffs. These comments related to industries or products including agricultural machinery, apparel, electrical machinery, footwear, gardening tools, mining-related equipment, paper, steel, organic sugar, other various agricultural products, various manufactured goods, and wood and wood products. These commenters presented a number of significant arguments for these requests, as discussed in the following paragraphs. We set forth responses to those arguments made by these commenters below.

Not available from U.S. sources. Numerous comments, such as those related to compressors, gardening tools, organic sugar, and stone, suggested that the product for which an exemption was requested was not available from U.S. sources. For example, comments related to organic sugar noted that domestic production supplied only a small portion of U.S. demand. With respect to stone, commenters pointed to the unique nature of the products sourced from Brazil, particularly colors and patterns not available in the United States. Other commenters in this category made similar arguments. Tariffs applied pursuant to this investigation will be applied only to products of Brazil, however, and products that are not available from the United States may be available from third-country sources.

Limits on third-country sourcing. Several comments, including comments requesting exemptions for rubber components of machinery and vehicles, and footwear, suggested the availability of supply for a particular product from sources outside Brazil may be limited. With respect to rubber components of machinery and vehicles, commenters noted that these components were part of established production programs that have been validated and approved by manufacturers and customers. With respect to footwear, comments and witness testimony focused on the fact that substitutions would not be available at the same quality and scale as products from Brazil. Such commenters do not suggest that substitution of products from U.S. or third-country sources was not possible, however, and the announcement of proposed tariffs on June 1, 2026, indicated that products from Brazil may be subject to tariffs and, as such, importers of such products have been on notice that seeking alternative sources may be appropriate.

Increased costs. Other comments, including comments related to apparel, chemicals and petrochemicals, electrical equipment, footwear, and stone products, suggested that application of tariffs on certain products from Brazil could increase costs for U.S. consumers or manufacturers. Comments related to stone products noted that tariffs could be passed along in increased home prices. With respect to electrical equipment, commenters noted that tariffs could raise the overall cost for establishing infrastructure for artificial intelligence applications. Regarding footwear, commenters suggested tariffs could have an adverse impact on American retailers, particularly small retailers. Regarding chemicals and petrochemicals, commenters asserted that tariffs would raise costs for downstream U.S. manufacturers, highlighted the ubiquity of chemicals in consumer products, and suggested that imports from Brazil would shift to other, less desirable foreign markets. A number of different factors may affect costs, however, and in any event, a number of these comments also concern consumer goods that are generally available from third countries.

Competitive disadvantage for U.S. businesses. Some comments, such as those related to agricultural machinery and vehicle parts, suggested that tariffs would put U.S. producers at a competitive disadvantage as compared to foreign producers who may import Brazilian imports without tariffs. With respect to vehicle parts, for example, commenters noted that U.S. manufacturers are attempting to diversify supply chains, but this process takes time. Comments related to agricultural machinery suggested that a tariff on goods of Brazil would force U.S. producers to choose between absorbing a cost disadvantage or reducing capital investment. However, a competitive disadvantage does not indicate unavailability of domestic supply or that the products cannot be produced in sufficient quantities or at reasonable prices in the United States or from other sources. Products may still be imported from third-country sources, meaning that any competitive disadvantage may only apply for producers who continue sourcing from Brazil. Additionally, a competitive ( printed page 45521) disadvantage does not indicate that the tariffs will cause an economy-wide disruption. Moreover, regarding vehicle parts, any products already subject to Section 232 tariffs are exempt from additional tariffs pursuant to this action.

Products unrelated to the acts, policies, and practices investigated. Some comments, such as those related to stone, machinery, and animal hides, furskins, and leather, noted that the products for which they requested exemption from tariffs were not related to the acts, policies, and practices found actionable in this investigation. Comments regarding stone, for example, noted that quarrying does not contribute to deforestation. Commenters requesting exemptions for machinery observed that there is no causal connection between the importation of Brazilian industrial machinery to the United States and the acts, policies, and practices determined to be actionable in this investigation. However, imposing tariffs on imports from Brazil can create greater leverage to obtain the elimination of the investigated acts, policies, and practices, and as described above, Section 301(c)(3)(B) of the Trade Act authorizes the Trade Representative to take action against any goods or economic sector of the foreign country concerned regardless of whether or not such goods or economic sector are involved in the act, policy, or practice subject to investigation.

Tariffs would not shift production to the United States. Some comments, such as those related to construction machinery, opposed imposition of tariffs on certain products, arguing that production of those products would not shift production to the United States. Comments with respect to construction machinery, for example, noted that tariffs on products from Brazil would apply to U.S. or multinational companies that were importing from their own Brazilian manufacturing operations. These requests for exclusion may suggest limited availability for a particular company, but do not suggest a general unavailability of products outside of Brazil.

Considering the public comments and the advice of the Section 301 Committee—and in accordance with the specific direction of the President—the Trade Representative has determined to not add these and other products to the list of products exempted from tariffs, as these products are not (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil found to be actionable in the investigation.

D. Comments Regarding the Form of the Action

USTR received a number of comments regarding the form of the action to be taken in this investigation. The vast majority of comments did not express disagreement with the form of the action proposed. Some comments suggested that the proposed action represented an appropriate remedy given the findings, and in certain cases specifically requested that tariffs be maintained on particular products or categories of products. For example, one comment expressed support for the proposed tariff and specifically requested the continued application of tariffs on wood moldings and millwork products. These commenters presented a number of significant arguments for these requests, as discussed in the following paragraphs. We set forth responses to such arguments below.

Comments regarding the tariff rate. Other comments addressed the proposed tariff rate of 25 percent specifically, and expressed mixed perspectives on the appropriateness of the rate. For example, commenters from the U.S. ethanol industry remarked that a 25 percent tariff on all goods of Brazil was an appropriate action in this case, was consistent with the findings of the investigation, and would allow the United States to recoup the market value it had lost due to Brazil's imposition of ethanol tariffs.

Some commenters who were opposed to the imposition of a 25 percent tariff remarked that this rate would significantly increase the cost of imported products from Brazil, which would result in disproportionate impacts on small businesses in particular, potentially causing them to stop hiring or even lay off workers. For ethanol specifically, testimony argued that, when considering the proposed 25 percent tariff rate alongside actions proposed in other investigations under Section 301 of the Trade Act, the total applied rate on Brazilian ethanol could be as high as 37.5 percent, which would be much higher than Brazil's tariff on U.S. ethanol and lead to further instability on the ethanol market. Other comments emphasized that, should tariffs be imposed, they should be carefully tailored and limited in size, scope, and duration and specifically structured to avoid unnecessary harm to U.S. stakeholders. Such comments also recommended that tariffs be subject to a transparent exclusions process, and that they be proportionate to the specific acts, policies, and practices addressed in this investigation.

As noted above, the President directed imposition of a 25 percent tariff on all goods of Brazil, with exemptions for certain goods, finding that alternatives such as a lower tariff rate, negotiation without the imposition of tariffs, and action under other statutory authority without action under Section 301 would be less effective and less preferable. Consistent with this direction, acts, policies, and practices found actionable in this investigation have persisted for years despite ongoing engagement with Brazil and other attempts to address these issues. The acts, policies, and practices found to be actionable in this investigation also have broad impacts on the U.S. economy. The imposition of a significant tariff on all products of Brazil, with certain exemptions, is appropriate to create leverage and obtain the removal of those acts, policies, and practices. USTR has carefully considered public comments on the proposed exemption list and has adjusted that list in the final action to avoid imposing tariffs on (a) raw materials that if subject to these tariffs could lead to the unavailability of domestic supply; (b) products that could cause economy-wide disruptions if subject to these tariffs; (c) products that cannot be grown or produced in sufficient quantities or at reasonable prices in the United States or obtained from other sources; or (d) articles for which these tariffs may not contribute substantially to the elimination of the acts, policies, and practices of Brazil determined to be actionable in the investigation.

Comments regarding Special 301 engagement. Regarding U.S. engagement with Brazil in the context of the ongoing Special 301 review (19 U.S.C. 2242) and the subjects of that engagement, numerous commenters expressed agreement with the Trade Representative's determination with respect to intellectual property protection as set out in the June 4, 2026 FRN. Comments noted continued concern with Brazil's approach to intellectual property protection and enforcement and urged USTR to press Brazil to address these longstanding issues. Comments also opined that concerns related to Brazil's intellectual property protection and enforcement could most durably be eliminated through specific, verifiable commitments. The imposition of tariffs ( printed page 45522) in this investigation occurs alongside other efforts, such as the preparation of the annual Special 301 Report.

Comments suggesting action other than tariffs. Several other comments suggested the Trade Representative should take action other than (or in addition to) the imposition of tariffs in this investigation. Some commenters suggested that the Trade Representative should suspend the action or close the investigation entirely. Some commenters suggested that the United States undertake bilateral negotiations with Brazil, or multilateral negotiations with Brazil and others, rather than or alongside the imposition of tariffs. Some testimony also similarly suggested that bilateral engagement would be more appropriate than tariffs and any tariff—even at a rate lower than 25 percent—would be inappropriate. Other commenters suggested that imposing tariffs would undermine the goals of the investigation, or questioned whether tariffs alone would obtain the elimination of certain acts, policies, and practices found actionable in this investigation. Another commenter suggested that the Trade Representative reconsider the findings stated in the June 4, 2026 FRN and engage in constructive dialogue. Other comments advocated for capacity building, technical cooperation or technical assistance, and similar non-tariff responsive actions. Certain commenters also proposed phase-in periods, exclusion processes, calibrated measures, and time limits or periodic review for tariffs. Some comments, such as those from U.S. ethanol producers, urged USTR to consider taking specific additional non-tariff actions to address certain non-tariff acts, policies, and practices of Brazil.

As noted above, the President directed imposition of a 25 percent tariff on all goods of Brazil, with exemptions for certain goods, finding that alternatives such as a lower tariff rate, negotiation without the imposition of tariffs, and action under other statutory authority without action under Section 301 would be less effective and less preferable. Consistent with this direction, acts, policies, and practices found actionable in this investigation have persisted for years, and negotiations and cooperative engagement alone have not proven sufficient to bring about their elimination, and the 25 percent tariff imposed in connection with this investigation reflects the broad impact of the acts, policies, and practices determined to be actionable in this investigation and is appropriate to create leverage and obtain their removal. The imposition of tariffs in this investigation does not preclude continued negotiations with Brazil. The Trade Representative will continue to monitor the issues raised in this investigation pursuant to Section 301 of the Trade Act and will consider whether modifications are appropriate. The Section 301 statute itself provides for the modification of actions, including a provision on review of necessity at Section 307(c) of the Trade Act (19 U.S.C. 2417(c)). Section 307 of the Trade Act provides that “[t]he Trade Representative may modify or terminate any action, subject to the specific direction, if any, of the President with respect to such action, that is being taken under [Section 301] if . . . the burden or restriction on United States commerce . . . of the acts, policies, and practices, that are the subject of such action has increased or decreased or [if] such action is being taken under [Section 301(b)] of this title and is no longer appropriate.”

Action by Brazil that decreases the burden or restriction on U.S. commerce may indicate that U.S. action at this level is no longer appropriate to obtain the elimination of Brazil's acts, policies, and practices determined to be actionable in this investigation. Likewise, action by Brazil that increases the burden or restriction on U.S. commerce—such as increases in duties on goods of the United States, as opposed to addressing U.S. concerns with the unfair practices found in the investigation—may indicate that U.S. action at this level is not sufficient to obtain the elimination of Brazil's acts, policies, and practices determined to be actionable in this investigation. Finally, the application of Section 301 tariffs in response to a particular act, policy, or practice does not preclude the application of other remedies pursuant to Section 301 of the Trade Act or other authorities, as appropriate and provided for under those other authorities.

Annex I

A. Effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern time on July 22, 2026, subchapter III of chapter 99 of the Harmonized Tariff Schedule of the United States (HTSUS) is modified as follows:

1. The following new headings are inserted in numerical sequence, with the material in each new heading inserted in the columns of the HTSUS labeled “Heading/Subheading”, “Article Description”, “Rates of Duty 1—General”, “Rates of Duty 1—Special” and “Rates of Duty 2”, respectively:

2. The following new U.S. note 50 is inserted:

“50. (a) (i) Except as provided in headings 9903.05.02-9903.05.09 and in subdivisions (a)(ii) through (a)(vi) of this note, and other than products for personal use included in accompanied baggage of persons arriving in the United States, heading 9903.05.01 imposes an additional ad valorem rate of duty on imports of all products of Brazil. Notwithstanding U.S. note 1 to this subchapter, all products that are subject to the additional ad valorem rate of duty imposed by this heading shall also be subject to the general rates of duty imposed under subheadings in chapters 1 to 97 of the tariff schedule. Except as provided in subdivisions (a)(ii) through (a)(vi) of this note, all products that are subject to the additional ad valorem rate of duty imposed by heading 9903.05.01 shall also be subject to any additional duty provided for in this subchapter or in subchapter IV of chapter 99. Products that are eligible for special tariff treatment under general note 3(c)(i) to the tariff schedule, or that are eligible for temporary duty exemptions or reductions under subchapter II to chapter 99, shall be subject to the additional ad valorem rate of duty imposed by heading 9903.05.01, except as otherwise provided in this subdivision.

The additional duty imposed by heading 9903.05.01 shall not apply to goods for which entry is properly claimed under a provision of chapter 98 of the tariff schedule pursuant to applicable regulations of U.S. Customs and Border Protection (“CBP”), and whenever CBP agrees that entry under such a provision is appropriate, except for goods entered under heading 9802.00.80 or subheadings 9802.00.40, 9802.00.50 or 9802.00.60. For goods entered under subheadings 9802.00.40, 9802.00.50 and 9802.00.60, the additional duty applies to the value of repairs, alterations or processing performed, as described in the applicable subheading. For goods entered under heading 9802.00.80, the additional duty applies to the value of the article assembled abroad, less the cost or value of such products of the United States, as described.

Products that are provided for in heading 9903.05.01 shall continue to be subject to antidumping, countervailing, or other duties, taxes, fees, exactions and charges that apply to such products, as well as to the additional ad valorem rate of duty imposed by this heading.

(ii) As provided in heading 9903.05.03, the additional duty imposed by heading 9903.05.01 shall not apply to articles the product of Brazil that are classifiable in the following subheadings of the HTSUS:

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(iii) As provided in heading 9903.05.04, the additional duty imposed by heading 9903.05.01 shall not apply to the following particular articles the product of Brazil:

(1) Etrogs (classifiable in subheading 0805.90.01);

(2) Tropical fruit, nesoi, frozen, whether or not previously steamed or boiled (classifiable in subheading 0811.90.80); ( printed page 45526)

(3) Date palm branches, Myrtus branches or other vegetable material, for religious purposes only (classifiable in subheading 1404.90.90);

(4) Bread, pastry, cakes, biscuits and similar baked products nesoi, and puddings, whether or not containing chocolate, fruit, nuts or confectionery, for religious purposes only (classifiable in subheading 1905.90.10);

(5) Bakers' wares, communion wafers, sealing wafers, rice paper and similar products, nesoi, for religious purposes only (classifiable in subheading 1905.90.90);

(6) Acai (classifiable in subheading 2008.99.21);

(7) Citrus juice of any single citrus fruit (other than orange, grapefruit or lime), of a Brix value not exceeding 20, concentrated, unfermented, except for lemon juice (classifiable in subheading 2009.31.60);

(8) Coconut water or juice of acai (classifiable in subheading 2009.89.70);

(9) Coconut water juice blends, not from concentrate, packaged for retail sale (classifiable in subheading 2009.90.40);

(10) Acai preparations for the manufacture of beverages (classifiable in subheading 2106.90.99); and

(11) Essential oils other than those of citrus fruit, nesoi, for religious purposes only (classifiable in subheading 3301.29.51).

(iv) As provided in heading 9903.05.05, the additional duty imposed by heading 9903.05.01 shall not apply to articles the product of Brazil that are civil aircraft (all aircraft other than military aircraft); their engines, parts and components; their other parts, components and subassemblies; and ground flight simulators and their parts and components, that otherwise meet the criteria of general note 6 of the HTSUS and are classifiable in the following provisions of the HTSUS, but regardless of whether a product is entered under a provision for which the rate of duty “Free (C)” appears in the “Special” sub-column:

(v) As provided in heading 9903.05.06, the additional duty imposed by heading 9903.05.01 shall not apply to articles the product of Brazil for use in pharmaceutical applications, and that are classifiable in the following provisions of the HTSUS, but regardless of whether a product is entered under a provision for which the rate of duty “Free (K)” appears in the “Special” sub-column:

(vi) As provided in heading 9903.05.07, the additional duty imposed by heading 9903.05.01 shall not apply to:

(1) articles of aluminum, of steel or of copper, nor to derivative aluminum or steel articles provided for in headings 9903.82.02 and 9903.82.04-9903.82.26;

(2) passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans and cargo vans) and light trucks provided for in headings 9903.94.01, 9903.94.02 (as applied to the U.S. content of passenger vehicles and light trucks described in subdivision 33(d) of this subchapter upon approval from the Secretary of Commerce), 9903.94.03, 9903.94.31, 9903.94.40, 9903.94.41, 9903.94.50, 9903.94.51, 9903.94.60 and 9903.94.61;

(3) parts of passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans and cargo vans) and parts of light trucks provided for in headings 9903.94.05, 9903.94.06 (as applied to parts of passenger vehicles that are eligible for special tariff treatment under the United States-Mexico-Canada Agreement (USMCA) other than automobile knock-down kits or parts compilations), 9903.94.07, 9903.94.32, 9903.94.33, 9903.94.42, 9903.94.43, 9903.94.44, 9903.94.45, 9903.94.52, 9903.94.53, 9903.94.54, 9903.94.55, 9903.94.62, 9903.94.63, 9903.94.64, 9903.94.65, 9903.94.66, 9903.94.67, 9903.94.68 and 9903.94.69, and parts of passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans and cargo vans) and parts of light trucks subject to an import adjustment offset pursuant to Proclamation 10925 of April 29, 2025 (90 FR 18899), as amended;

(4) wood products provided for in headings 9903.76.01, 9903.76.02, 9903.76.03, 9903.76.20, 9903.76.21, 9903.76.22, 9903.76.23 and 9903.76.24;

(5) medium- and heavy-duty vehicles, buses and other vehicles provided for in headings 9903.74.01, 9903.74.02, 9903.74.03 and 9903.74.06;

(6) medium- and heavy-duty vehicle parts provided for in headings 9903.74.08, 9903.74.09 and 9903.74.10, and parts of medium- and heavy-duty vehicles subject to an import adjustment offset pursuant to Proclamation 10984 of October 17, 2025 (90 FR 48451); and

(7) semiconductor articles provided for in heading 9903.79.01.”

B. Effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern time on July 31, 2026, subchapter III of chapter 99 of the HTSUS is modified as follows:

1. The article description of heading 9903.05.07 is modified by inserting “patented pharmaceutical articles;” after “wood products;”; and

2. Subdivision (a)(vi) of U.S. note 50 is modified:

a. by deleting the word “and” at the end of item (6);

b. by deleting the period at the end of item (7) and by inserting “; and” in lieu thereof; and

c. by inserting the following new item (8) in numerical order: “(8) patented pharmaceutical articles provided for in headings 9903.04.60-9903.04.66.”

Annex II

Note:

All products that are properly classified in the provisions of the Harmonized Tariff Schedule of the United States (HTSUS) that are listed in this Annex are not covered by the action, except as provided in the “Scope Limitation” column. The product descriptions that are contained in this Annex are provided for informational purposes only, and are not intended to delimit in any way the scope of the action. In the product descriptions, the abbreviation “nesoi” means “not elsewhere specified or included.” Any questions regarding the scope of particular HTSUS provisions should be referred to U.S. Customs and Border Protection.

Notes on certain HTSUS provisions for which only a portion of the provision is covered in this Annex, as provided in the “Scope Limitations” column:

• A subheading marked with “Ex” is defined and limited by the product description.
• A subheading marked with “Aircraft” includes only articles of civil aircraft (all aircraft other than military aircraft); their engines, parts, and components; their other parts, components, and subassemblies; and ground flight simulators and their parts and components, that otherwise meet the criteria of general note 6 of the HTSUS, regardless of whether a product is entered under a provision for which the rate of duty “Free (C)” appears in the “Special” sub-column.
• A subheading marked with “Pharma” includes only articles for use in pharmaceutical applications, regardless of whether a product is entered under a provision for which the rate of duty “Free (K)” appears in the “Special” sub-column.

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91 FR 45516