NEWS | NSBA Speaks on Exemption, Shares Resources on Small Business and Tariffs

Fighting for the nation's most important economic community, NSBA is proud to advocate for effective tariff policies, including exemptions for small business.

JUNE 12, 2025 | Nearly 150 days into the second Trump Administration, tariffs remain front and center, as the White House seeks to establish trade policy and reshape the balance of global commerce. This should come as no surprise: not only was the President proselytizing tariffs while on the campaign trail, but his first administration also made them a major theme, particularly with regards to China.

Background: What are Tariffs?

Put simply, a tariff is a levy assessed by a government upon the import (or, very occasionally, export) of a covered item.

What are Tariffs Used for?

Historically, tariffs have had a number of uses. Interestingly, arguably the first major legislation ever passed by Congress was the Tariff Act of 1789. This first tariff regime allowed the early U.S. to fund government operations and repay national debts from the Revolutionary War. More recently, tariffs have been used not simply as a funding mechanism, but as a deterrent against increasing imports and growing influence of overseas economies. The most prominent example of this is the tariff threat on imported cars in the 1970s, which led to Japanese automakers voluntarily reducing their exports to the United States to avoid potential duties.

The Trump Administration maintains that the goal of these newest tariffs is to level the economic playing field for U.S. companies, and to help correct trade imbalances with foreign nations.

What are the Latest Tariffs?

On April 2, 2025, in a Rose Garden event billed by the White House as “Liberation Day,” President Trump announced a new universal tariff regime, including a baseline 10% tariff on all foreign imports (apart from those from Canada and Mexico), as well as additional “reciprocal” tariffs specifically prescribing higher rates for countries with deeper trade imbalances with the United States. The general implementation date for the majority of these measures was initially set as April 9, 2025.

Subsequently, on April 10, 2025, the White House announced a short-term pause (until July 9, 2025) in the implementation of many of the new tariffs to allow for negotiation between the U.S. and foreign governments. The major exception to the new July date was China (and Hong Kong & Macau), whose reciprocal rates were actually increased and implemented until May 14, 2025, when the White House granted a reprieve until August 12, 2025, from reciprocal, but, notably, not baseline 10 percent tariffs.

So, What Can We Do?

Right now, small companies with the greatest exposure to tariffs or trade disputes generally would be well advised to audit their supply chains and/or marketing strategies for potentially affected goods, so that they can best develop effective strategies to mitigate their impacts.

One possible strategy is to focus on onshoring critical manufacturing and sourcing. To better assist small companies in this process, the Small Business Administration (SBA) has launched its Make Onshoring Great Again portal, which shortlists verified domestic suppliers.

Meanwhile, NSBA and SBEA are continuing to look for alternative solutions for America’s small businesses. One bill we have championed in successive Congresses is the bipartisan, Helping Small Businesses to Hedge Risk and Insure Against Volatile Expenses (THRIVE) Act. This commonsense legislation, authored by Senators Jeanne Shaheen (D-NH) and Bill Cassidy (R-LA) would help small companies to hedge volatility by directing SBA to create a program allowing small businesses to hedge costs in vital input goods and commodities like diesel, electricity, or lumber.

Small Businesses Should be Exempt

NSBA is calling on the Trump Administration to consider options to ease the pressure on main street entrepreneurs, including a potential small business exemption from the elevated reciprocal tariffs. Tariffs can create a cash-flow crunch that hits the smallest businesses hardest; the current uncertain environment also hampers growth-oriented decisions by small-business owners.

NSBA understands President Trump and his Administration are working around the clock with foreign counterparts to secure the most beneficial trade deals for American businesses and consumers; however, NSBA also recognizes the President's unique ability to act to reduce volatility and protect the most vulnerable businesses.

Help us lead common sense solutions to support the nation's most important economic community. Share your small-business story about the impacts of tariffs.