US weighs plan to slash China tariffs to as low as 50% as soon as next week: sources

New York Post

08-05-2025

The Trump administration is weighing a plan to slash the 145% tariff on Chinese imports by more than half — effective as soon as next week — as top US and China officials head to Switzerland for high-level trade negotiations, The Post has learned.
Specifically, US officials are discussing a proposal to lower President Trump's punishing levy on China goods to between 50% and 54% as they begin what promise to be lengthy talks to hammer out a trade agreement, sources close to the negotiations said.
Meanwhile, trade taxes on neighboring south Asian countries would be cut to 25%, the source added.
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'They are going to be bringing it down to 50% while the negotiations are ongoing,' the source said of the trade tax on China.
5 The CEOs, including Doug McMillon of Walmart, all said the April 21 meeting at the White House was 'productive' and 'constructive' without offering details, according to reports.
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Insiders said the 50%-to-54% range — down from the triple-digit level that Treasury Secretary Scott Bessent said this week 'isn't sustainable' this week — is in keeping with rates that were discussed last month when President Trump met with the bosses of the three biggest retailers in the US.
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The CEOs – Doug McMillon of Walmart, Brian Cornell of Target and Ted Decker of Home Depot – all said the April 21 meeting at the White House was 'productive' and 'constructive' without offering details, according to reports.
In response, a 'whisper' campaign spread quickly and 'the number that emerged to get the ships flowing out of China was 54%,' said Jay Foreman, CEO of Basic Fun, which makes its retro toys in China including Tonka Trucks, Care Bears and My Little Pony.
'The signals we are getting is that the dam will break by the end of this week or next, that there will be an adjustment,' Foreman told The Post.
Accordingly, many retailers already have begun asking vendors to quote prices based on a range of tariff rates — anywhere between 10% and 54% — 'so they are ready to price when the goods land' in the US, Foreman added.
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5 The toy industry is in crosshairs of the tariff wars as 80% of toys sold in the US are made in China. Target CEO Brian Cornell, above.
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White House spokesman Kush Desai told The Post in a statement, 'When decisions on tariffs are made, they will come directly from the President. Anything else is just pure speculation.'
Nevertheless, 'CEOs felt very reassured after Bessent's remarks at Milken,' a source told The Post, referring to the Treasury secretary's 'sustainable' comment at the Milken Institute Global Conference in Los Angeles this week. 'People are realizing that deals are going to be made.'
Treasury's phone has been 'blowing up' with southeast Asian nations looking to seal a deal, the source added.
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The chatter in retail circles has likewise been traveling fast — and is very specific, industry sources told The Post.
5 Treasury's phone has been 'blowing up' with southeast Asian nations looking to seal a deal, a source said. Treasury Treasury Secretary Scott Bessent, above.
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'We are hearing China at 50% to 54% and [other] Asian countries at 25%,' said Lawrence Rosen, chairman of Cra-Z- Art, a New Jersey-based arts-and-crafts distributor.
Another toy CEO, Nick Mowbray of Zuru – maker of Bunch O Balloons – said 'The speculation is 54%,' but he added, 'That's definitely not been told explicitly to retail yet.'
While sharply lower than what's currently in effect, s 50% trade tax would pose a formidable challenge as retailers prepare for the crucial holiday season, sparking drastically higher prices at stores, retail executives said.
5 Home Depot CEO Ted Decker
Home Depot
A Tonka Mighty Dump Truck priced at $29.99 this week would cost $49.99 with a 54% tariff. While steep, that's 'workable,' according to Forman. A 145% levy, on the other hand, would translate to a $79.99 Tonka truck, which is 'just too much' and would bring sales to a virtual standstill, he said.
Noel Hacegaba, chief operating officer of the Port of Long Beach in California, said 'there are high hopes that the meeting between the US and China in Switzerland will help to de-escalate growing trade tensions and set a path forward for resolving the trade war.'
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He added, however, 'it will take a strong signal coming out of the meeting for shippers to readjust their sourcing and routing.'
The toy industry is in crosshairs of the tariff wars as 80% of toys sold in the US are made in China.
Basic Fun has 35 containers on the water that are expected to arrive in the US this week and next, but seven of them were sent on April 10 when the 145% levy became effective.
5 Noel Hacegaba, chief operating officer of the Port of Long Beach in California, said 'there are high hopes that the meeting between the US and China in Switzerland will help to de-escalate growing trade tensions.'
AFP via Getty Images
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Foreman plans to store those containers in a warehouse because his company can't afford the higher levy. The rest of his toys are being stored at warehouses and at his factories in China – until he gives the word to ship them here.
'The retailers behavior changed after the White House meeting as if they got some confidence,' said retail guru Gerald Storch, a former CEO of Toys R Us and Canadian department store HBC.
'They are less panicked about how quickly they need a domestic source and they seemed to relax a little bit,' Storch told The Post. 'This is what I've heard from vendors about the retailers' tone and sense of urgency.'