U.S. President Donald Trump has signed an executive order reducing tariffs on Sri Lankan goods from 44% to 20%, with the new rate set to take effect from August 7, 2025, the White House announced.
The reduction follows earlier negotiations and a letter sent to Sri Lankan President Anura Kumara Dissanayake on July 10, which had temporarily lowered the tariff to 30%. The final revision comes just hours before the August 1 deadline for the U.S. Trade Realignment Initiative.
The tariff adjustments are part of a broader policy under which Trump declared an economic emergency on April 2, imposing a baseline 10% tariff for countries with a U.S. trade surplus and a 15% floor rate for those with a deficit. Sri Lanka, identified as having a trade imbalance with the U.S., was initially subjected to a steep 44% tariff.
The White House stated the policy aims to correct unsustainable trade deficits and strengthen national security. “President Trump is using tariffs as a necessary and powerful tool to put America First,” the statement said.
Sri Lanka is among more than 50 countries whose tariff rates were revised, including Bangladesh (from 37% to 20%), Vietnam (from 46% to 20%), and Cambodia (from 49% to 19%).
Sri Lanka’s apparel industry, which exports primarily to the U.S., had voiced concerns about potential losses under the higher tariff structure. The revised 20% rate is expected to provide temporary relief, although it remains above the rates granted to some regional competitors.
