What the proposal contains

The White House announced on 3 June 2026 that it intended to impose levies of 10% to 12.5% on imports from 60 countries, as first reported by the Guardian. The list includes the UK, the EU's 27 member states, Canada, Australia and Taiwan. The stated rationale is that these nations have failed to prevent forced labour from entering global supply chains.

The proposal is significant not only for its breadth but for its legal architecture. Earlier Trump-era tariff programmes, notably those imposed under Section 301 and Section 232 of US trade law, were constrained by a series of federal court rulings in 2025 that limited the executive branch's ability to impose blanket levies without specific statutory authority. By framing the new tariffs around forced labour, the administration appears to be invoking a different statutory basis, most likely drawing on provisions of the Tariff Act of 1930 and the Uyghur Forced Labor Prevention Act (UFLPA), which grant broader executive discretion to restrict imports linked to coerced work.

This legal manoeuvre, according to the Guardian's reporting, would allow the president to skirt the court-imposed limits that curtailed his earlier trade agenda. If the tariffs proceed, they would apply on top of any existing duties, compounding costs for importers.

The EU responded immediately, stating it expected the US to honour the tariff agreement struck in July 2025. That deal, which ended a prolonged dispute over steel and aluminium duties, included mutual commitments to avoid new unilateral levies on a range of goods. Brussels argued that tariffs imposed under a forced-labour banner still breached the spirit of the agreement if they functioned as general trade barriers rather than targeted enforcement actions.

Which UK sectors face the greatest exposure

The United States is the UK's single largest export market for goods. Office for National Statistics data shows that UK goods exports to the US totalled approximately £60 billion in 2025, making it a critical destination for manufacturers, food and drink producers, and automotive component suppliers.

Manufacturing and industrial goods

UK manufacturers exported roughly £16 billion worth of machinery, mechanical appliances and industrial equipment to the US in 2025, according to ONS trade statistics. A 10–12.5% tariff on these goods would erode price competitiveness against US domestic producers and competitors in countries not on the 60-nation list. Small and mid-sized manufacturers operating on thin margins would feel the impact most acutely.

Food and drink

The UK food and drink sector has expanded its US footprint in recent years, with exports to the US valued at approximately £2.5 billion annually, according to the Food and Drink Federation. Scotch whisky, cheese, confectionery and craft beverages are among the highest-value categories. These products already navigate a complex US regulatory landscape; an additional tariff layer would raise landed costs and could price some producers out of the market.

Automotive components

UK-based automotive suppliers ship engines, transmissions and other components to US assembly plants. The Society of Motor Manufacturers and Traders has previously estimated that UK automotive exports to the US exceed £8 billion per year. Many of these supply relationships operate on just-in-time logistics with contractually fixed pricing, meaning suppliers may be unable to pass tariff costs through to customers in the short term.

Broader SME exposure

Beyond headline sectors, any UK SME or scale-up that invoices in dollars or ships physical goods to the US faces potential margin compression. Businesses sourcing raw materials or components through other affected countries, such as Taiwan for semiconductors or Canada for timber and metals, could also see input costs rise even if their own exports are not directly targeted.

The forced-labour compliance dimension

The forced-labour framing introduces a compliance challenge that goes beyond tariff arithmetic. The US has steadily tightened import controls linked to labour practices, most notably through the UFLPA, which took effect in June 2022 and created a rebuttable presumption that goods produced in China's Xinjiang region involve forced labour.

By extending the forced-labour rationale to tariffs on 60 countries, the administration is signalling that supply-chain due diligence is no longer a concern limited to imports from China. Operators selling into the US may increasingly need to demonstrate, with documentary evidence, that their supply chains are free from coerced labour at every tier.

For UK businesses, this dovetails with existing obligations. The Modern Slavery Act 2015 already requires companies with turnover above £36 million to publish annual statements on their efforts to prevent forced labour and human trafficking. However, the US standard under the UFLPA is more prescriptive, requiring specific traceability documentation rather than narrative disclosure.

SMEs that fall below the Modern Slavery Act threshold may nonetheless find themselves caught in the compliance net if their US customers or import brokers demand proof of supply-chain integrity as a condition of continued trade. The practical effect is that forced-labour due diligence is becoming a market-access requirement, not merely a reporting obligation.

What operators should do now

The tariffs remain a proposal, not yet enacted. The timeline for implementation is unclear, and legal challenges are likely given the novel statutory basis. Nonetheless, businesses with US exposure should begin preparing.

Quantify the exposure. Finance directors should model the impact of a 10% and 12.5% tariff on US-bound revenue. This means identifying which product lines cross the US border, their current duty classification, and the margin headroom available to absorb additional costs.

Map the supply chain. Operators should trace their supply chains at least two tiers deep, identifying any sourcing from countries on the 60-nation list. Inputs from Taiwan, Canada and EU member states are all potentially affected, which could raise costs even for goods sold domestically if those inputs become more expensive.

Audit labour-practice documentation. Businesses should review whether they hold adequate records to demonstrate supply-chain due diligence on forced labour. This includes supplier contracts, audit reports, and traceability records. Companies already compliant with the Modern Slavery Act have a foundation, but may need to upgrade their documentation to meet the more granular US standard.

Review contracts and pricing. Exporters with fixed-price US contracts should check whether those agreements contain tariff adjustment clauses. Where they do not, renegotiation may be necessary before any new duties take effect.

Watch the legal landscape. The court rulings that constrained earlier tariff programmes remain relevant. If the forced-labour rationale is challenged and struck down, the tariffs may never materialise. Businesses should monitor developments through trade associations and legal advisers rather than making irreversible supply-chain changes prematurely.

The proposal is a reminder that US trade policy remains volatile and that UK businesses selling across the Atlantic need contingency planning as a standing discipline, not a one-off exercise.