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Treasurer Jim Chalmers says the federal government is “urgently seeking” clarity on whether Australia will be hit by the United States’ new pharmaceutical and copper tariffs.
Early Wednesday morning AEST, US President Donald Trump told cabinet that countries can expect 50 per cent tariffs on copper as soon as late July as part of his larger trade blitz.
He also flagged that the US would soon announce a “very high rate, like 200 per cent” on pharmaceuticals, but would allow manufacturers time to relocate their operations to the US first.
“We’re going to give people about a year, a year and a half to come in, and after that, they’re going to be tariffed,” Trump said.
Chalmers said the developments around pharmaceuticals in particular were “very concerning”, but noted the US accounts for only 1 per cent of Australia’s copper exports.
“Our pharmaceuticals industry is much more exposed to the US market, and that’s why we’re seeking, urgently seeking, some more detail on what’s been announced,” he told ABC’s RN Breakfast on Wednesday morning.
“I want to make it really clear once again, as we have on a number of occasions before, our Pharmaceutical Benefits Scheme is not something that we’re willing to trade away or do deals on. That won’t change.”
In 2024, Australia exported roughly $2.1 billion of medicinal and pharmaceutical products to the United States, Australian Bureau of Statistics data shows.
If the US were to put tariffs on medicinal exports, this could make Australian drugs more expensive.
Driving down demand could also force manufacturers to move overseas, where the costs of operations are cheaper.
US President Donald Trump has warned that pharmaceuticals and copper could be the next commodities to be hit with tariffs. Source: AP / Evan Vucci/AP
For months, the US pharmaceutical industry has been pressuring Trump to add Australian and other Pharmaceutical Benefits Scheme (PBS) manufacturers to the tariff list, complaining it was “damaging pricing policies” and threatening billions in lost sales.
As part of its election platform, Labor committed to passing legislation that would make the maximum cost of prescription medicine covered by the PBS $25.
Under the PBS, the government negotiates prices directly with suppliers to make them cheaper for Australians.
Prime Minister Anthony Albanese and other Labor frontbenchers, including Health Minister Mark Butler, have repeatedly vowed that the PBS “is not for sale”.
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