The decision to hit Brazil with a 25% tariff will become an “election gift” for President Lula, Bolsonaro’s predecessor said US | Today’s news

(Bloomberg) — The U.S. decision to hit Brazil with 25 percent tariffs renews a trade battle with the government of President Luiz Inacio Lula da Silva just months before an election that could affect the outcome of a highly polarized race.

While the Trump administration has cited unfair trade practices for imposing tariffs on certain Brazilian goods since July 22, the fallout may end up being political with presidential elections due in October.

Lula, as Brazil’s president is known, has successfully rallied public opinion to his side in the face of earlier US trade pressure. He will face right-wing senator Flavio Bolsonaro, who flew to the US earlier this month to testify against trade sanctions then being considered, saying they would only help the leftist leader’s re-election.

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“The proposed tariffs would reward the very perpetrators they are meant to punish,” Bolsonaro wrote in his filing with the Office of the US Trade Commissioner.

Those appeals by the son of former president Jair Bolsonaro, an ally of Donald Trump, appear to have been brushed aside during the US investigation. Brazilian business groups have already begun criticizing the measure, warning it could deal a significant blow to the country’s exporters.

The year-long investigation “found a number of Brazilian practices to be unreasonable and discriminatory, limiting the competitive position of U.S. farmers, workers, innovators and exporters,” the Office of the U.S. Trade Representative said in a statement on Wednesday.

US Trade Representative Jamieson Greer said the measure was necessary “to address these unfair trade practices to ensure that American workers and companies can compete on a level playing field.” The US remains open to negotiations to resolve the identified issues, he said in a statement.

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Imports of coffee, beef and some ethanol products would be exempt from the new tariffs, a senior administration official told reporters ahead of the announcement. However, ethanol would be subject to new tariffs.

While the exclusion of a key Brazilian export potentially limits the impact on Latin America’s largest economy, politics appear to be harder to put aside.

Lula’s poll ratings have soared after he blasted US pressure to attack Brazil’s sovereignty, and he now has a strong line of attack against his opponent, whose father was at the center of Trump’s initial efforts to hammer Brazil with trade tariffs.

Lula’s campaign will revive the strategy it adopted when the tariffs were first announced in early June, instructing supporters to use social media to link the tariff hike to Bolsonaro, reinforcing the narrative that he has betrayed the country, according to a person involved in the plan.

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The campaign plans to focus its message on the slogan “TariFlávio” while putting aside, at least for now, the issue of alleged meddling in Brazil’s election, the person said, speaking on condition of anonymity because he was not authorized to discuss campaign strategy publicly.

“No justification”

Brazil’s government condemned the tariffs and said it would take measures to insulate its economy from their effects. She also said the Bolsonaro family worked with the US government to allow them to do so.

“There is no justification for unilateral measures against our country,” the Brazilian government said in a statement. “We will continue to diversify our business partnerships and open new markets for our products.”

The US administration proposed an additional 25% tariff on imports from Brazil in a June 1 report following an investigation under Section 301 of the Trade Act of 1974. The report specifically cited the central bank’s electronic payment service known as Pix, which is used by millions of Brazilians daily.

The US argued that Brazil had “unfairly disadvantaged” US providers of competing electronic payment services by adopting policies favoring Pix, a platform that Lula has repeatedly portrayed as a symbol of the country’s technological sovereignty and financial independence.

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Brazil has said there is no merit to the Pix allegations and has vowed to pursue reciprocal tariffs and concessions through the World Trade Organization.

In his submission, Flavio Bolsonaro also defended Pix, describing it as “one of the hallmarks of the Jair Bolsonaro administration.”

In a post on X, Secretary of State Marco Rubio accused the Brazilian government of not negotiating in good faith. He said Lula’s “economic policies are bad for Americans and bad for Brazilians. Over the past year, Lula has put his ego ahead of making a deal for the welfare of the Brazilian people, and these tariffs are the price.”

Flavio Bolsonaro retweeted Rubio’s post.

Last year, Trump imposed 50% tariffs on a wide range of Brazilian goods in an effort to pressure Brazilian authorities to prosecute Jair Bolsonaro, who is under house arrest serving a 27-year sentence for an attempted coup after his 2022 election defeat to Lula.

Most of these duties were later lifted following negotiations between Brazil and Washington, a diplomatic victory for Lula.

On Monday, a Brazilian Supreme Court judge banned Flavio Bolsonaro from visiting his father for 90 days, effectively preventing any visits until the first round of elections in October. Judge Alexandre de Moraes, who has previously been targeted by the Trump administration, said Flavio Bolsonaro abused his visitation rights to help the former president circumvent a court-ordered social media ban.

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The stakes are high for both countries. The US is Brazil’s second largest trading partner and one of the few major economies with which it runs a trade deficit. Brazil imported more than $45 billion in U.S. goods in 2025, up 11% from the previous year, while exports fell nearly 7%, with oil accounting for 12.5% ​​of supplies.

Despite the escalating dispute, the two governments are still trying to avoid a wider trade conflict. Greer has met repeatedly with Brazilian Trade Minister Márcio Elias in recent months to seek a solution. Lula’s government intends to continue negotiations until the last possible moment, but has ruled out concessions it deems politically or legally unacceptable, including changes to Pix, according to a person familiar with the talks.

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Disclaimer: This story was published from a wire agency source without editing. Only the title was changed.