Financial Reporting Symposium - Virtual-7 - Schindler

7 - Schindler - tariff turbulence

Pdf Summary

The presentation reviews the rapid changes in U.S. tariff policy in 2026 and their effects on manufacturers, trade, and accounting.<br /><br />A key development was the Supreme Court’s 6-3 ruling on Feb. 20 that the International Emergency Economic Powers Act (IEEPA) could not be used to impose tariffs. This effectively removed many of the Trump administration’s new tariffs, including country-specific tariffs and a 10% global tariff. In response, the administration quickly introduced new tariffs under other authorities, including Section 122, Section 301, Section 232, and later Section 338.<br /><br />The deck explains the current tariff “menu”:<br />- Section 232 tariffs remain in place for products such as steel, aluminum, copper, vehicles, timber, lumber, cabinetry, and furniture, with additional investigations underway for pharmaceuticals, semiconductors, medical devices, robotics, and other industries.<br />- Section 301 tariffs, generally 10% to 12.5%, now cover most trade partners.<br />- Section 122 tariffs, which had temporarily replaced some IEEPA tariffs, expired on July 24.<br />- Section 338 tariffs were imposed on Canada as retaliation.<br /><br />The economic impact has been significant. Tariffs pushed the average applied tariff rate in 2025 to 17.9%, the highest since 1934, before easing somewhat after the court ruling. The presentation notes tariffs act like a major tax increase and can raise inflation and household costs.<br /><br />It also highlights growing tensions with Canada, including retaliatory tariffs tied to U.S. measures and strain on USMCA negotiations.<br /><br />Finally, the presentation outlines accounting implications, such as impairment testing, inventory valuation, tax assets, debt covenants, liquidity, and disclosures, and it lists mitigation strategies including price increases, supplier diversification, nearshoring, tariff engineering, and inventory optimization.

Keywords

U.S. tariffs

Supreme Court ruling

IEEPA

Section 232

Section 301

Section 338

trade policy

manufacturers

accounting implications

Canada retaliation