Trump says nations doing business with Iran face 25% tariff on US trade

Impact of Tariffs on International Trade

By Kanishka Singh and Trevor Hunnicutt

Details of the Tariff Announcement

WASHINGTON, Jan 12 (Reuters) - President Donald Trump said on Monday any country that does business with Iran will face a tariff rate of 25% on trade with the U.S., as Washington weighs a response to the situation in Iran which is seeing its biggest anti-government protests in years.

Reactions from Iran and Other Nations

"Effective immediately, any Country doing business with the Islamic Republic of Iran will pay a Tariff of 25% on any and all business being done with the United States of America," Trump said in a post on Truth Social.

Legal Challenges to Trump's Trade Policy

Tariffs are paid by U.S. importers of goods from those countries. Iran has been heavily sanctioned by Washington for years.

"This Order is final and conclusive," Trump said without providing any further detail. Top export destinations for Iranian goods include China, the United Arab Emirates and India.

There was no official documentation from the White House of the policy on its website, nor information about the legal authority Trump would use to impose the tariffs, or whether they would be aimed at all of Iran's trading partners. The White House did not respond to a request for comment.

Iran, which had a 12-day war with U.S. ally Israel last year and whose nuclear facilities the U.S. military bombed in June, is seeing its biggest anti-government demonstrations in years.

Trump has said the U.S. may meet Iranian officials and that he was in contact with Iran's opposition, while piling pressure on its leaders, including threatening military action.

Tehran said on Monday it was keeping communication channels with Washington open as Trump considered how to respond to the situation in Iran, which has posed one of the gravest tests of clerical rule in the country since the Islamic Revolution in 1979.

Demonstrations evolved from complaints about dire economic hardships to defiant calls for the fall of the deeply entrenched clerical establishment. U.S.-based rights group HRANA said it had verified the deaths of 599 people - 510 protesters and 89 security personnel - since the protests began on December 28.

While air strikes were one of many alternatives open to Trump, "diplomacy is always the first option for the president," White House press secretary Karoline Leavitt said on Monday.

During the course of his second term in office, Trump has often threatened and imposed tariffs on other countries over their ties with U.S. adversaries and over trade policies that he has described as unfair to Washington. 

Trump's trade policy is under legal pressure as the U.S. Supreme Court is considering striking down a broad swathe of Trump's existing tariffs.

Iran, a member of the OPEC oil producers group, exported products to 147 trading partners in 2022, according to World Bank's most recent data.

(Reporting by Kanishka Singh, Trevor Hunnicutt and Bhargav Acharya; Editing by Don Durfee and Lincoln Feast.)