The White House accused over 40 countries, including Canada, Japan, Mexico and the EU, of costing the US billions in potential profits by helping China “evade” US tariffs, rerouting and relabelling Chinese goods to disguise their origin.

The White House Office of Trade and Manufacturing Policy report, released on 13 August, details an alleged global phenomenon known as the “Great Transshipment Scam,” in which exporters evade US tariffs by rerouting goods through third‑party countries.

Washington estimates the value of goods rerouted each year at $34 billion, according to the White House Council of Economic Advisers; $75 billion, according to the analytics firm Exiger; around $40 billion, according to Goldman Sachs; and as high as $303 billion, according to Altana.

“Lost” tariff revenue is calculated at $19 billion to $26 billion annually in the central case, based on $75 billion of transshipped goods, rising to above $100 billion at the high end under broader exposure assumptions.

The report also estimates an additional $19 billion to $26 billion per year in lost federal tax receipts due to the drop in domestic economic activity.

The report also attributes some 450,000 displaced US jobs and a reduction in annual GDP of $113 billion to $150 billion to the practice.

Peter Navarro, the architect of Trump’s global tariff policy and head of the Office of Trade and Manufacturing Policy, said Beijing had turned to “extremely sophisticated” methods to route goods through third countries in the years since Trump first imposed tariffs on China in 2018.

“For years, the great transshipment scam has let communist China launder its exports to more than 40 countries, rob our Treasury of tens of billions of dollars and steal the pay cheques of American workers,” Navarro said.

Washington is building an artificial intelligence system called “Detective Border” to help Customs and Border Protection flag suspect shipments, weighing factors such as routes, product details, and ownership records to distinguish legitimate trade from evasion.

“The message to the world is simple. The age of untraceable illegal transshipment is over,” the report states.

The report follows a sharp escalation in Washington’s use of trade measures, with the White House imposing tariffs of 10 to 12.5 percent on goods from 60 countries covering 99 percent of all US imports, accusing them of failing to enforce bans on products made with forced labor.

Brazil called the justification arbitrary and said it would take the case to the World Trade Organization (WTO), while EU Foreign Policy Chief Kaja Kallas dismissed the reasoning outright.

On 22 June, Beijing targeted US entities, placing 10 under export controls and restricting dual-use goods, and also took action against 46 US firms, mostly defense contractors, in government procurement.

The measures came in direct response to the Pentagon adding 65 Chinese companies, among them the tech giants Alibaba and Baidu, to its blacklist of firms accused of aiding the country’s military.