Brazil warns that it will propose taxes on US products if Trump follows the threat of the 50% rate

The Brazilian president, Luiz Inacio Lula da Silva, said Thursday that he would impose retaliation tariffs to the United States if President Donald Trump follows a promise to boost import taxes by 50% on the criminal trial of the country of South America against his predecessor, Jair Bolsonaro.

Lula said it would activate the Brazilian reciprocity law approved by Congress earlier this year if negotiations with the United States fail.

“If there is no negotiation, the reciprocity law will get to work. If it charges 50 (% of rates) of us, we will charge you 50,” Lula to TV Record told TV in extracts of an interview that will be transmitted completely later in the day. “Respect is good. I like to offer mine and I like to receive it.”

Lula’s comments increase the risk of a war of rates that explode between the two countries, similar to what has happened between the United States and China. Trump has promised to respond strongly if countries seek to punish the United States by adding their own tariffs.

The president of the Senate of Brazil, Senator Davi Alcolusta, and the president of the Chamber of Deputies, Hugo Motta, a couple of moderates who have recently disagree with Lula, agreed that the Law of Recipes gives Brazil “the media … to protect our sovereignty.”

“We will be ready to act with balance and firmness in defense of our economy, our productive sector and the protection of Brazilian works,” they said in a joint statement.

The tariff letter that Trump sent to Brazil, and published on social networks on Wednesday, criticizing the trial of “witch hunting” against Bolsonaro opened a new front in his commercial wars, with the US leader directly using import taxes to interfere with the internal policy of another nation.

Trump has already tried to use tariffs to apparently combat fentanyl traffic and as a negotiation tool to change the way other nations tax digital services and regulate their economies.

In the case of Brazil, Trump is trying to dictate the result of Bolsonaro’s criminal trial, an ally who, as Trump, has been accused of trying to cancel a presidential election. Bolsonaro argues that he is being politically persecuted by the Supreme Court of Brazil for his positions for the alleged plot to remain in power after his 2022 electoral defeat before Lula.

“There is nothing that Lula or Brazil can do about Bolsonaro’s trial,” said Carlos Melo, a professor of political science at Insper University at Sao Paulo. “Any change in that would be the capitulation of Brazil. Bolsonaro’s situation will not change here. How do you negotiate about that?”

Lula ordered his diplomats on Thursday to return Trump’s letter if he physically arrives at the Presidential Palace in Brasilia. The document attacks the country’s judiciary and mentions the recent decisions about social media companies among the reasons why the assets of the South American nation will have higher rates from August 1.

Trump has initiated his tariffs under the International Law of Emergency Economic powers of 1977, saying in April that the persistent deficit between what the United States and what matters is a national crisis.

But the United States directs a commercial surplus with Brazil, undermining part of logic.

An employee of the Brazilian Ministry of Foreign Affairs told News that the commercial negotiations that were ongoing since Trump imposed a first set of rates in April are now “in the air.”

Some members of the Lula Administration say that Trump’s measure is aimed at Brazil’s connection with other South economies, as shown on Sunday at the BRICS Nations Summit organized in Rio de Janeiro. The president of Brazil, once again, mentioned the hope of a currency alternative to the dollar for transactions, an issue that often attracts Trump’s anger.

“Trump was never worried about democracy anywhere, much less with Bolsonaro’s fate,” said Gleisi Hoffmann, Minister of Institutional Relations of Brazil.

Trump’s interference in Brazilian affairs has brought a sense of unity that was largely absent in the politically divided nation. Some of Bolsonaro’s allies said that Lula had attracted the anger of the president of the United States with other decisions, including criticism of the Israel War in Gaza. But other supporters of the former president decided to ask for prudence in the negotiations.

The newspaper or state of S. Paulo, a frequent critic of Lula and his administration, said in an editorial on Thursday that Trump’s move against the Brazilian government is “one thing of the mafia.” He also said that Lula’s reaction was correct, a rare feature for the newspaper.

Analysts also see Trump’s attempt to interfere with the country’s national affairs as a possible backlash to Bolsonaro during his judgment and an impulse for Lula, whose re -election offer faced the winds against this year.

The Canadians recently chose Mark Carney as prime minister, and his liberal party re -founded for Trump’s tariffs and threats to turn Canada into state 51 of the United States.

“The reaction of many people is that this is a political gift for Lula,” said Andre Pagliarini, professor of International History and Studies at the State University of Louisiana who is also affiliated with the Quincy Institute for responsible stract.

Thomas Traumann, an independent political consultant and former Brazilian minister, described the Trump movement “A change of play” for next year’s elections.

“Trump put Lula again in the game,” Taumann said. “This gives Lula a narrative, puts Bolsonaro as the guilty part of any economic problem.”

The United States International Trade Court ruled in May that Trump had exceeded his authority by declaring an emergency to impose tariffs without the approval of Congress. The Trump administration is appealing that decision, but the opponents plan to use their letter from Brazil to strengthen their case.

“This is a blatant illegal effort of Donald Trump to sacrifice the economy to solve his own personal scores, and is far from his legal authority,” said Oregon’s Democratic Senator Ron Wyden.

The Republican Administration has argued that its tariffs are now relatively harmless to the economy of the United States, since inflation has tended in recent months. But many companies stored imports to anticipate import taxes, and it is not clear what happens when their inventories decrease and consumers consider the highest price risk. Most external economic analyzes expect growth to decrease.

In Brazil, Trump’s interest is expected in Bolsonaro’s trial despite the trial. The media have reported that legislators and judges are concerned that the former president tries to leave Brazil for the United States if he is convicted.

The legislator Eduardo Bolsonaro, son of the former president, moved to the United States in March. On Wednesday night, he asked his followers in X to publish “his thanks to President Donald Trump.”

In Thursday’s interview, Lula said that old Bolsonaro “should assume the responsibility of agreeing Trump’s taxes to Brazil.”

“His son was there to take Trump’s mind, then he (Trump) writes a letter to talk about a case that is in the hands of the Supreme Court. A case that is not a political trial. What is under investigation is the evidence of the case,” Lula said.

___

Boak reported from Washington.

• Brazil
• Donald Trump
• Policy
• Mark Carny
• Taxes
• Luiz Inacio Lula da Silva
• Jair Bolsonaro