Effective tomorrow, July 24, the United States will implement a new round of tariffs. For the major cigar-producing countries, these new tariffs will amount to a slight increase for the Dominican Republic and Nicaragua, while Honduras will remain at its current rates.
The latest round of tariffs, known as Section 301 tariffs, is being done under the guise of concerns regarding forced labor in more than 60 countries. The use of forced labor is not a regular talking point from the White House, but it does serve as a pathway to enact these tariffs, which can be done without approval from Congress.
Over the last few months, the Office of the U.S. Trade Representative (USTR) has been going through the necessary steps to fulfill Section 301. This included a recent hearing, where multiple cigar trade groups submitted testimony.
| Country | As of April 2, 2025 | As of April 9, 2025 | As of July 2025 | As of February 2026 | As of July 24, 2026 |
|---|---|---|---|---|---|
| China | 34 percent | 125 percent | 51 percent | 30 percent | 12.5 percent |
| Costa Rica | 10 percent | 10 percent | 15 percent | 10 percent | 12.5 percent |
| Dominican Republic | 10 percent | 10 percent | 10 percent | 10 percent | 12.5 percent |
| European Union | 20 percent | 10 percent | 15 percent | 15 percent | 12.5 percent |
| Honduras | 10 percent | 10 percent | 10 percent | 10 percent | 10 percent |
| Nicaragua | 19 percent | 10 percent | 18 percent | 10 percent | 12.5 percent |
For Honduras, the third-largest exporter of handmade cigars to the U.S., this means the current 10 percent rate stays in effect, though for the Dominican Republic and Nicaragua—the second-largest and largest, respectively—the rates will increase slightly to 12.5 percent.
“President Trump recognizes that decades of moral suasion have not eradicated forced labor from global supply chains,” said Jameison Greer, the U.S. trade ambassador, in a press release. “The United States has had a forced labor import ban for nearly a century, and rigorously enforces it; it’s well past time for our trading partners to do the same. 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. I am encouraged by the trading partners who have moved quickly to adopt forced labor import prohibitions, and look forward to ensuring their effective enforcement.”
The Section 301 tariffs have long been anticipated since February, when the Supreme Court invalidated Donald Trump’s sprawling “Liberation Day” tariff scheme. Shortly after that, the White House announced new emergency tariffs—an across-the-board 10 percent tariff—using Section 122 of the U.S. Trade Act of 1974.
Because Trump has enacted the tariffs without Congressional approval, he has limited pathways to keep the widespread tariff scheme alive.
Both the original “Liberation Day” tariffs and the Section 122 tariffs were ruled illegal by the U.S. Court of International Trade, a specialized federal court that handles trade matters. The Section 122 tariffs have remained in effect while the government appeals that ruling, though Section 122 limited the length of the emergency tariffs. Barring authorization from Congress, which did not happen, those tariffs expire on Friday, July 24.
It was widely expected that, eventually, the White House would enact the Section 301 tariffs to help keep the tariff scheme going. Unlike last year’s tariffs, Section 301 has some limits, which is why the tariff rates are between 10-12.5 percent.
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