The U.S. has dramatically increased tariffs on some Chinese goods to a combined rate of 145%, intensifying an ongoing trade dispute. The new figure includes a 125% base tariff and an additional 20% penalty related to China’s alleged role in the U.S. fentanyl crisis. The White House clarified that earlier reports of a 125% tariff didn’t account for this extra levy.

In response, China has imposed its own 84% tariff on U.S. imports, raising fears of a deepening trade war.

The move has already shaken global financial markets. Major U.S. stock indices saw steep declines, with the S&P 500 dropping 4.5%, the Nasdaq down 5.25%, and the Dow Jones falling 3.67%. Tech giants like Apple, Meta, Tesla, and Microsoft were hit particularly hard.

Chinese sellers on Amazon and other platforms are also feeling the pinch, with many raising prices or considering withdrawing from the U.S. market entirely.

Former President Trump defended the tariff hike as necessary to counter China’s trade practices and protect American industry. Critics, however, warn that the tariffs could backfire—raising prices for U.S. consumers and hurting businesses that rely on Chinese imports.

While the U.S. has paused new tariffs on other countries for 90 days, the steep China-specific tariffs remain in place, signaling that the economic standoff may continue to escalate.