PIX, ethanol and STF: understand the US criticism to justify the 25% tariff on Brazilian products

USA proposes 25% tariff on Brazilian goods to punish 'unreasonable' practices
The United States concluded this Monday (1st) an investigation that accuses the Brazilian government of adopting practices that "encumber or restrict" trade with North Americans. Among them are PIX, illegal deforestation, piracy and failures in the application of anti-corruption laws.
As a result of the investigation, the US Trade Office (USTR) proposed the application of 25% tariffs on Brazilian goods. The body, however, included a list of exceptions for products considered strategic by the US, such as meat, fruit, coffee, aircraft, rare earths, among others.
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According to the USTR's final report, the following Brazilian government practices "encumber or restrict" trade with the USA:
Digital commerce and payment services (PIX): the text states that the Central Bank favors PIX, an instant payment system, to the detriment of American providers. According to the USTR, the BC acts at the same time as a regulator and operator of the system, imposing its use and limiting the fees charged by competitors.
Regulation of social networks: the USTR states that Brazilian courts issued confidential orders for American social media companies to remove political content and suspend profiles of US residents - in some cases, with global reach -, in addition to prohibiting the disclosure of these decisions. The body also criticizes the application of high fines, restrictions on assets and bank accounts and, in at least one case, the complete blocking of a website.
Unfair preferential tariffs: the American government contests the trade agreements maintained by Brazil with Mexico and India. According to the USTR, the country grants lower tariffs to hundreds of products from these markets in sectors in which both are considered advanced and globally competitive producers;
Illegal deforestation: the document states that, although Brazil has a legal framework to combat illegal deforestation, the country has historically failed to apply it effectively, allowing the problem to continue;
Access to the ethanol market: the American body argues that Brazil abruptly interrupted treatment in 2017 balanced tariff applied to ethanol and, since then, does not offer reciprocity to fuel exports from the USA;
Protection of intellectual property: the USA points out flaws in the application of criminal and customs laws against counterfeiting products, in addition to slowness in analyzing patents and continuous actions to combat piracy. The report also criticizes the time taken to analyze patents by the National Institute of Industrial Property (INPI), especially in the biopharmaceutical sector, which can take up to 109 months.
Fighting corruption: the American representation concluded that Brazil does not adopt sufficient measures to combat bribery and corruption. The document cites the annulment of Operation Lava Jato processes by the STF in 2023, the "without transparency" renegotiation of leniency agreements and the country's fall in Transparency International's Corruption Perception Index.
The new rate is not yet in effect. Under American law, the formal investigation must be completed and a series of public consultations must be carried out before the measures come into force.
See below what you need to know about the US decision.
Why has Brazil become the target of this investigation?
What is the US trade investigation?
Which products can be exempt?
What are the next steps and deadlines?
Is this a new tariff?
Why has Brazil become the target of this investigation?
After the US Supreme Court considered the tariffs imposed by President Donald Trump illegal, the commercial investigation based on the Trade Law became one of the main instruments of pressure on the American government.
It was opened on July 15, 2025 by order of Trump. A week earlier, he had already mentioned the possibility in the letter in which he announced a 50% tariff on Brazilian imports.
At the time, the US trade representative, Jamieson Greer, stated that he had documented "Brazil's unfair trade practices that have restricted the access of American exporters to its market for decades", but did not present evidence to support the accusation.
The document brought together commercial and political arguments, including the allegation that the US has a trade deficit with Brazil. However, Americans have exported more to the Brazilian market than they import since 2009. (learn more below)
Now, Greer states that the American government maintains an intense dialogue with the administration of President Luiz Inácio Lula da Silva, but that there are still differences between the two countries.
"Over the last year, President Trump and I have had several constructive meetings with President Luiz Inácio Lula da Silva and his cabinet, which have intensified in recent weeks. However, we continue to have substantial divergences in resolving the issues identified in this investigation", he stated.
Although the negotiations were supposed to end this Friday (5), participants in the conversations stated that there was not enough progress to conclude the work, as revealed by Valdo Cruz's blog this Monday.
The new decision frustrates Lula's plans to hold a new conversation with Trump to try to avoid financial retaliation and economic impacts related to the classification of the PCC and the CV as terrorist groups.
What is the commercial investigation of the USA?
The investigation against Brazil was opened based on Section 301 of the Trade Act of 1974. The mechanism, created by the US Congress, allows the American government to investigate countries whose policies or practices are considered harmful to American trade, companies or exporters.
The legislation gives the USTR the power to investigate possible trade barriers and, if it concludes that they exist, recommend retaliatory measures, such as the imposition of tariffs on imported products.
The mechanism has already been used in different trade disputes, especially against China. In 2019, during Trump's first term, the US applied tariffs on more than US$120 billion in Chinese products based on this legislation.
Part of these tariffs remain in force, and were even expanded during Joe Biden's government.
Lula and Trump in a meeting at the White House
Ricardo Stuckert
Which products could be exempt?
Despite the proposal to impose 25% tariffs on Brazilian products, a A series of items must be left out of the measure, such as informational materials, donations and products included in a specific list of exceptions.
Among the exempt products are certain meats, fruits and minerals, as well as coffee, tea, spices, cereals, seeds, oilseed fruits, industrial and medicinal plants, straw and forage.
Aircraft and parts produced in Brazil, rare earths, organic chemicals, medicines and fertilizers would also be among the exempt items.
See the list below of the main products excluded from taxation.
What are the next steps and deadlines?
During the initial phase of the investigation, still in 2025, the US had already collected statements from more than 30 witnesses and received more than 295 comments and replies before the release of the current opinion.
The working group was created after the visit of the Brazilian president to the American president, on May 7, at the White House. On social media, the USTR even highlighted the Brazilian government's "constructive engagement" to move forward on trade issues and stated that it looked forward to continued discussions between the two countries.
The conclusion of the investigation comes within the deadline established for the negotiations of the working group created by the Brazilian and US governments to discuss trade issues and try to avoid the application of new tariffs.
US Trade Representative, Jamieson Greer, speaks to the press on the day he participates in a working lunch with EU trade ministers, in Brussels, Belgium, November 24, 2025.
Piroschka van de Wouw/Reuters
Before the definitive application of any sanction or corrective measure, the US government defined a schedule of public hearings and consultations to receive expressions from interested parties:
Until June 22, 2026: deadline for sending requests to participate in the public hearing, accompanied by a summary of the testimony.
Until July 1, 2025. 2026: deadline for submitting written comments on the measures proposed by the USTR.
July 6, 2026: holding the USTR public hearing to debate the proposed measures.
July 15, 2026: legal deadline for defining and possibly applying corrective measures against Brazil.
Is this a new tariff?
US President Donald Trump points the finger during a cabinet meeting in the White House Cabinet Room, in Washington, DC, USA, on May 27, 2026
REUTERS/Evan Vucci
On February 20 of this year, the majority of justices of the United States Supreme Court concluded that the International Emergency Economic Powers Act (IEEPA), used by Trump, does not authorize the president to impose tariffs on his own.
In response to the decision, Trump announced the use of another legal instrument to impose a 10% global tariff, with some exceptions. The measure came into force the following week and remains valid until July 24.
In practice, the Supreme Court decision annulled all tariffs imposed based on IEEPA.
This includes the so-called 10% reciprocal tariffs, announced in April last year.
Also the 40% surcharge on several Brazilian items, announced by Trump in a letter sent to President Lula in July 2025.
At the time, the Trump administration had already indicated that it could resort to other legal grounds to impose import tariffs, such as arguments related to national security or trade practices considered unfair.
Some of these alternatives were even mentioned in the dissenting opinion of Judge Brett Kavanaugh, of the Supreme Court. Among them was precisely Section 301 of the 1974 Trade Law, which allows the government to impose tariffs without limit on value or duration, as long as there is a formal investigation and public consultations.

Source: G1