Secure Trade Act
- Bill Number
- H.R. 4978
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Foreign Trade and International Finance
- Status
- Introduced
- Latest Action
- 2025-08-15: Referred to the Committee on Ways and Means, and in addition to the Committees on Financial Services, Foreign Affairs, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- Last Updated
- 2026-06-11T12:32:58Z
AI-Generated Summary
Purpose of the Legislation
The Secure Trade Act (H.R. 4978) aims to protect U.S. economic and national security by imposing new tariffs on imported goods, with a particular focus on reducing U.S. reliance on imports from China. It seeks to address unfair trade practices, penalize human rights violations, and promote domestic production through higher duties and stricter import rules.
Key Provisions
- General Tariffs on All Imports (Title I):
- Imposes a 10% ad valorem duty (a percentage of the good's value) on all imported goods starting from the date of enactment, in addition to existing duties.
- The President can reduce (but not eliminate) this rate for specific U.S. economic sectors if it serves national interest or security, after consulting congressional committees (House Ways and Means and Senate Finance).
- Tariffs and Rules Specific to China (Title II):
- Revised Tariff Rates: The President must update the Harmonized Tariff Schedule (HTS, a standardized list of tariff rates for imports) to apply higher duties only to goods from China. Non-strategic goods get a minimum 35% ad valorem rate; "specified articles" (critical supply chain items, those under trade investigations, or dual-use goods like items with both civilian and military applications) get a minimum 100% rate.
- Inflation Adjustments: Specific or compound duties (fixed amounts per unit or a mix) are adjusted annually based on the Consumer Price Index (a measure of price changes for everyday goods) to maintain value over time, starting January 1, 2025, with retroactive rules for initial collection.
- Phase-In Schedule: Duty increases are rolled out gradually over 5 years (10% after 180 days, 25% after 2 years, 50% after 4 years, full 100% after 5 years).
- Tariff-Rate Quotas for China-Only Goods: For goods imported exclusively from China (based on Commerce Department data), quotas allow limited low-duty imports equal to the U.S. consumption minus domestic production gap. In-quota imports face phased duties; above-quota imports face 100% duties immediately after a 3-year grace period.
- Presidential Flexibility: The President can raise duties further (phased over 5 years) to counter U.S. dependence on China or unfair practices, impose quotas to phase out reliance, or ban imports if they threaten national security, involve unfair practices, or violate human rights. Temporary waivers (up to 60 days) are allowed for national security.
- Valuation of Chinese Imports: Changes how Chinese goods are valued for duties—using "U.S. value" (the price at which similar goods sell in the main U.S. market, ready for delivery) instead of export value. Importers must submit statements, verified by U.S. Customs and Border Protection (CBP), with input from the International Trade Commission (ITC).
- Specified Articles: Includes items on critical supply chain lists (from Executive Order 14017), under Section 301 (unfair trade) or Section 232 (national security) investigations, or dual-use items (as defined in export control laws).
- Investment Review (Section 204):
- Expands the Committee on Foreign Investment in the United States (CFIUS, a government panel reviewing foreign investments for security risks) to cover "greenfield" (new facilities) and "brownfield" (existing site upgrades) investments by "foreign countries of concern" (e.g., those like China with ties to their government). Mandatory filings are required for such deals involving real estate and new U.S. businesses.
- Supporting Roles:
- ITC provides annual data on ad valorem equivalents, production/consumption estimates, and critical articles.
- CBP enforces valuation and collections.
Significant Changes to Existing Law
- New Universal Tariff: Introduces a blanket 10% duty on all imports, absent in current law, which relies on product-specific rates in the HTS.
- China-Specific HTS Revisions: Shifts China to "Column 2" rates (historically for non-favored nations like the former Soviet bloc), but with mandatory hikes (e.g., to 35% or 100%), phase-ins, and quotas—altering the Most Favored Nation (MFN) treatment China receives under WTO rules.
- Valuation Shift: Amends the Tariff Act of 1930 to mandate U.S.-based valuation for Chinese goods, overriding standard methods (like transaction value at export), potentially increasing assessed duties.
- CFIUS Expansion: Modifies the Defense Production Act to include real estate-based investments by concerning countries, requiring declarations (short notices) for review, broadening scrutiny beyond mergers/acquisitions.
- Inflation Indexing: Adds annual CPI adjustments to specific duties, a novel feature not standard in U.S. tariff law.
Potential Impacts
- On Government Agencies: Increases workload for CBP (enforcement, verification, retroactive collections), ITC (data reporting), and the President (proclamations, consultations). Commerce Department aids in identifying China-only goods and critical items.
- On Citizens and Businesses: Higher import costs could raise prices for consumers (e.g., electronics, clothing) and burden importers/exporters with compliance. U.S. manufacturers may benefit from reduced foreign competition, potentially boosting jobs but risking supply chain disruptions.
- On International Relations: Targets China aggressively, possibly escalating trade tensions or prompting retaliation (e.g., tariffs on U.S. exports). Could strain WTO compliance, as universal tariffs and China-specific hikes may violate non-discrimination rules. Broader duties affect allies and global trade partners.
Main Stakeholders Affected
- U.S. Importers and Businesses: Face higher costs and paperwork, especially those reliant on Chinese supply chains (e.g., tech, manufacturing sectors).
- Consumers: Likely higher prices for imported goods, impacting everyday affordability.
- U.S. Producers: Gain competitive edge in critical sectors like semiconductors or pharmaceuticals.
- Chinese Government and Exporters: Hit by punitive duties, quotas, and bans, reducing market access.
- Foreign Investors from Concerned Countries: Subject to stricter CFIUS reviews, deterring investments in U.S. real estate and facilities.
- Congressional Committees: Gain consultation roles in presidential decisions.
- Trade Agencies (CBP, ITC, Commerce): Expanded enforcement and analytical duties.
Notable Legal, Constitutional, or Political Implications
- Legal: Enhances presidential trade authority under existing laws (e.g., Trade Act of 1974, Trade Expansion Act of 1962), but phase-ins and waivers require congressional input, balancing executive power. Valuation changes and HTS modifications could face challenges in trade courts or WTO disputes for favoring U.S. methods or discriminating against China.
- Constitutional: Relies on Congress's commerce clause powers (Article I, Section 8) to regulate trade; delegation to the President is standard but could raise questions if waivers bypass Congress excessively.
- Political: Represents a protectionist shift, appealing to domestic industry lobbies but risking bipartisan divides over inflation, consumer costs, and foreign policy. Targets "countries of concern" (implicitly China) amid geopolitical tensions, potentially influencing U.S.-China relations and election-year trade debates.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Rep. Golden, Jared F. [D-ME-2]
Cosponsors (1)
Rep. Steube, W. Gregory [R-FL-17]
Recent Actions
- 2025-08-15: Referred to the Committee on Ways and Means, and in addition to the Committees on Financial Services, Foreign Affairs, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-08-15: Referred to the Committee on Ways and Means, and in addition to the Committees on Financial Services, Foreign Affairs, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-08-15: Referred to the Committee on Ways and Means, and in addition to the Committees on Financial Services, Foreign Affairs, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-08-15: Referred to the Committee on Ways and Means, and in addition to the Committees on Financial Services, Foreign Affairs, and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-08-15: Introduced in House
- 2025-08-15: Introduced in House
Bill Versions
- Secure Trade Act — issued 2025-08-15 — PDF (21 pages)