Trump imposes new 12.5% tariff on Singapore on alleged forced labour ban violation

A significant part of Singapore’s exports to the US is now subject to a new 12.5 percent levy aimed at rebuilding President Donald Trump’s tariff regime after it was undermined by a court decision earlier in 2026.

A US Federal Register notice published on July 23 (Washington time) listed the Republic among dozens of other economies that now face duties of between 10 percent and 12.5 percent after a probe by the Office of the US Trade Representative (USTR) into forced labour concerns.

Announcing the new levy, US Trade Representative Jamieson Greer said: “The United States has had a forced labour import ban for nearly a century, and rigorously enforces it; it’s well past time for our trading partners to do the same.”

The USTR investigation – which started in March and concluded in July – placed Singapore among 45 economies that will face higher duties of 12.5 per cent, claiming they have failed to both adopt and effectively enforce prohibitions on trade in goods produced with forced labour.

The Straits Times has contacted the Ministry of Trade and Industry for comment.

Goods from some 10 trading partners deemed to have adopted forced-labour restrictions will be subject to 10 per cent tariffs, including Mexico, Britain, Canada and India.

Goods from Japan, Switzerland and South Korea will also be taxed at 12.5 per cent, but in a way that complies with the trade agreements they reached with the US.

Singapore has rejected suggestions that it engages in unfair trade practices, including the use of forced labour in supply chains, and has told the US that it does not condone such practices.

Foreign Minister Vivian Balakrishnan told reporters on July 23, after wrapping up a week of meetings at the ASEAN Foreign Ministers’ Meeting in Manila, that he had raised the matter during a bilateral meeting with US Secretary of State Marco Rubio.

In June, the Ministry of Trade and Industry said that some exports will remain exempt, such as energy and energy products, pharmaceuticals and pharmaceutical ingredients, certain electronics, certain aerospace products, semiconductors, and metals used in currency and bullion.

It also said that about one-third of Singapore’s domestic exports to the US would be subject to the new duty.

However, since the US Federal Register notice issued on July 23 has updated the exemption list, Singapore’s exposure to the new tariff will need to be recalculated.

According to a presidential memorandum issued by the White House, goods already facing Trump’s sector-specific tariffs – such as steel and aluminium – will not be impacted.

Certain energy products and fertilisers will be exempt too, alongside goods covered by the US-Mexico-Canada free trade pact.According to a presidential memorandum issued by the White House, goods already facing Trump’s sector-specific tariffs – such as steel and aluminium – will not be impacted.

Certain energy products and fertilisers will be exempt too, alongside goods covered by the US-Mexico-Canada free trade pact.

The new tariff is part of a series of measures initiated to impose new and harsher tariffs after the US Supreme Court in February struck down the legal basis for Trump’s signature reciprocal tariffs, imposed in 2025.

It replaces a 10 per cent global levy under Section 122 that was imposed immediately after the court’s decision and expired earlier this week.

Singapore, along with 15 other economies, is also subject to USTR’s investigations under Section 301 into acts, policies, and practices relating to structural excess capacity and production in manufacturing sectors.

It is unclear when the findings of that probe will be released, or whether any future duties from that investigation would be stacked on top of those proposed under the forced labour investigation.

Last week, Greer said in a Bloomberg Television interview that the excess capacity investigation is taking longer than the one into forced labour because the USTR is trying to make sure that the measure lives up to the letter of the law.

Experts believe the Trump administration is using Section 301 of the Trade Act of 1974 as the legal basis for imposing the new tariff on trade in goods produced with forced labour because it has no statutory expiration date or maximum percentage cap.

Historically, measures imposed under this law have also proven far more resilient against judicial overturns.

However, using the statute as a dragnet to apply blanket global or multilateral tariffs to dozens of countries stretches the law beyond Congress’ intent. As a result, experts anticipate immediate lawsuits once the tariff takes effect.

-The Strait Times