Tariffs & Trade Barriers
The simple average applied tariff across WTO members sits at 8.7% — its highest reading since 2002 and a full point above the pre-2018 trough. US-China tariff lines, the EU Carbon Border Adjustment Mechanism, and a wave of export controls have reversed two decades of tariff reduction.
Key insights
US-China tariff lines now structural
Section 301 tariffs first imposed in 2018–19 have been retained across two administrations and selectively raised in 2024–25 (EVs to 100%, batteries 25%, solar 50%, semiconductors 50%). Roughly two-thirds of bilateral trade ($375B by value) now carries tariffs above the MFN rate. Chinese retaliation covers $185B of US exports at average 21.6%.
Tariff peaks concentrated in agriculture and apparel
Bound MFN rates on industrial goods average 6% across WTO members, but agricultural tariffs average 17% (and exceed 100% on many sensitive lines — rice into Japan, sugar into the US, dairy into Canada). Apparel tariffs in major importing markets sit at 11–15%, the highest of any major industrial category.
Climate-linked border measures rising
The EU CBAM transition phase ends in 2026; importers of cement, steel, aluminium, fertilizer, hydrogen and electricity now report embedded emissions and pay a carbon-equivalent charge from January 2026. The UK launches its CBAM in 2027. Similar bills are advancing in Canada and Australia. These do not appear in conventional tariff statistics but function as variable trade barriers.
Simple average applied tariff — major economies (2026)
Trade-weighted, all products, %
Key Finding: India leads major economies at 17.3% average applied; the EU and Japan sit near 5%. The US weighted average rose to 9.4% with the China lines included.
Global average tariff 1995–2026
Trade-weighted, all WTO members
Key Finding: Tariffs fell steadily from 11% (1995) to a 3.6% trough (2017) and have climbed since under US-China escalation, EU CBAM and a wave of export controls.
Methodology & caveats
Bound, MFN, applied
Bound tariffs are the legal ceilings each WTO member commits to. MFN (most-favoured-nation) applied tariffs are what a country actually charges on imports from other WTO members. Preferential tariffs are the lower rates that flow from free trade agreements. Headline averages can mean any of the three — always check which.
Simple vs trade-weighted averages
A simple average treats every tariff line equally. A trade-weighted average multiplies each line by the share of imports it covers. Trade-weighting is more economically meaningful but introduces an endogeneity bias: prohibitive tariffs reduce trade volumes and therefore receive a low weight. The truth is somewhere between the two.
Non-tariff barriers don't show up here
Quotas, anti-dumping duties, technical standards, sanitary and phytosanitary measures, export controls, and CBAM-style border carbon charges all restrict trade without appearing in tariff statistics. The WTO estimates non-tariff measures now account for more trade distortion than tariffs themselves.