US Makes Tariff Surcharge Permanent

For European exporters, the problem with American trade policy is no longer just the tariff. It is the calendar. On 24 July, the temporary 10% US import surcharge on most goods runs out because the law behind it limits presidential tariff action to 150 days (19 U.S.C. § 2132). The charge itself is not simply going away. Washington is moving to other legal hooks, and those can last longer, stack on top of each other and leave firms planning against rules that keep changing.

Who actually pays

The first question is not how large the tariff is. It is who ends up carrying it. A study by AHK, the German chambers of commerce abroad, found that US buyers absorb more than 70% of tariff costs on German goods. The Kiel Institute put the remaining burden for Germany at about 0.15% of GDP, or roughly €6.5bn (aktiv-online). So this is not a clean American bill landing in Europe. US importers and consumers are paying a large share.

But national figures can make the damage look tidier than it is. Ireland is a good example, and also a warning about reading trade data too literally. Goods exports from Ireland to the US fell 56% year on year in May 2026, to €4.7bn, while pharma exports dropped nearly 59% (Irish Examiner, CSO). On the face of it, that looks like a collapse. In Irish data, though, multinationals book high-value pharma through Irish subsidiaries, and a few changes in shipment timing can throw the figures all over the place. Ibec, the business lobby, tracked US-bound exports rising from €22bn in January-April 2024 to €60bn in the same period of 2025, before falling back to €17bn in 2026 (The Irish Times).

Italy shows the same lesson from another angle. Its overall exports to the US still grew 3.7% in early 2026 (Assolombarda/ICE). Inside that respectable headline, wine exports fell roughly 15%, with average prices down 10%, as producers cut their own margins to keep American customers (Borsa Italiana/Teleborsa). Furniture was down 16.6%, textiles 5.6% (Il Messaggero). The aggregate held because pharma jumped 54.1% (Il Foglio).

The legal basis keeps shifting

The deeper problem is that the US trade regime keeps changing the instrument it uses. In February 2026, the Supreme Court struck down the use of a national-emergency law for tariffs. The administration then moved to Section 122, a temporary import-surcharge power. In May, a trade court ruled even that unlawful, though the relief applied only to the companies that had sued (Northeastern University, BDO).

Washington is already preparing sturdier tools. The US Trade Representative has opened Section 301 investigations, a route in American trade law that allows duties after Washington finds unfair foreign practices. These cover 16 economies, including the EU, with proposed rates of 10-12.5% (Mayer Brown, National Law Review). Unlike the expiring surcharge, they do not come with a built-in sunset.

A June EU-US deal capped most European exports at 15%, but the cap is not the whole story. A product can appear to fall under that ceiling and still face a separate steel or auto duty on top (Euronews). Germany's trade agency has warned firms to check product classifications, meaning the tariff category a good falls into, as well as exemptions and documentation for every shipment to the US (GTAI).

The quieter damage happens further back in the supply chain. In Slovakia, the share of Volkswagen Bratislava's output going to the US has fallen below 15% (Denník E). The bigger worry is not this year's sales, but where the parent company decides to build the next model. Slovak press has reported concern that Porsche Cayenne production could leave Bratislava, affecting hundreds of suppliers, though Volkswagen has not confirmed any move (Pravda). The same logic runs across Central Europe, where Polish, Czech and Austrian parts makers depend on decisions taken in Wolfsburg or Munich.

For European exporters, this is becoming a chronic condition rather than a passing shock. The White House keeps leverage. Firms already producing inside the US gain an advantage. Thin-margin producers, smaller companies tied to one major customer, and traditional sectors such as wine, food and furniture are more exposed because American buyers can wait them out. The cost that trade data catches late is the investment that drifts towards the American market, because no finance chief wants to build a five-year plan around rules that can rewrite themselves every 150 days.