The U.S. has implemented a new tariff on Australian goods, arguing Australia hasn’t done enough to stop products made with forced labour from entering the American market.
It comes just over a week after the Australian Government announced stricter penalties for companies that fail to prevent modern slavery in their supply chains.
Australia’s Trade Minister Don Farrell called the decision “extremely disappointing,” saying Australia “takes the issue of modern slavery seriously”.
Background
In April 2025, U.S. President Donald Trump announced widespread tariffs, including a blanket 10% levy on most goods entering the U.S.
A tariff is a tax on imports. It’s applied to foreign-made goods brought into another country and paid by the importer.
The goal of tariffs is to encourage companies and consumers to buy locally produced products, boosting domestic industry.
Despite a longstanding free trade agreement, Australia was not exempt.
Modern slavery
Modern slavery is an umbrella term for situations where people are forced to work against their will through threats, violence, or deception.
In 2018, Australia passed the Modern Slavery Act, which requires large businesses to report annually on the risk of forced labour in their supply chains.
However, the law is a reporting framework rather than a ban on importing products made with forced labour.
Your contribution ensures The Daily Aus can continue doing the work you love.
I want to give $10 monthly to help TDA keep doing the news.
Your details:
New tariffs
The U.S. has its own law prohibiting the import of goods made with forced labour.
It wants its trading partners to have similar restrictions in place.
U.S. Trade Representative Jamieson Greer said: “Today’s action will begin to correct what is both a human rights abuse and distortive trade practice to improve the welfare of workers everywhere.”
The Trump administration has now implemented a new 12.5% tariff on goods from 60 countries, including Australia, arguing those nations have not done enough to prevent products linked to forced labour from entering American markets.
The tariff will take effect from Friday, replacing the existing 10% baseline tariff on Australian exports to the U.S.
Other countries such as Indonesia, Canada, and the UK will pay a lower rate of 10% because they have a partial import ban on goods produced using modern slavery, or they have committed to enforcing one.
Response
Shortly after the modern slavery tariffs were first announced in June, the Government unveiled a suite of changes to strengthen Australia’s laws.
This included proposing criminal penalties for companies with revenue over $100 million, that allow modern slavery practices in their supply chain. The Government did not say this was in response to the threat of new tariffs.
On Friday, Trade Minister Don Farrell told Sky News: “These tariffs are unjustified and we call on the U.S. Government to reverse them.”
