President Donald Trump will impose 10 percent tariffs on $200 billion worth of Chinese imports, and those duties will rise to 25 percent at the end of the year.
The action, announced by the Trump administration Monday, escalates a trade conflict between the world's two largest economies. China has already threatened to retaliate against new duties.
The White House removed about 300 goods from a previously proposed list of affected products, including smart watches, some chemicals, and other products such as bicycle helmets and high chairs.
Trump, in a statement, said that the tariffs would rise to 25 percent on Jan. 1, 2019, adding that "if China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports."
Trump has previously said that those additional duties are "ready to go on short notice if I want."
The action will only ratchet up tensions between Washington and Beijing. The president seeks a new trade agreement amid complaints about alleged theft of intellectual property by Chinese companies and concerns about the U.S. trade deficit with China. The two sides have failed to reach a deal to resolve the White House's concerns with China's trade practices despite a series of talks.
"We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly," Trump said in the statement.
"But, so far, China has been unwilling to change its practices."
The president has defended his tariff moves, despite mounting criticism from Republican lawmakers and potential political damage. On Monday morning, he tweeted: "Tariffs have put the U.S. in a very strong bargaining position, with Billions of Dollars, and Jobs, flowing into our Country - and yet cost increases have thus far been almost unnoticeable. If countries will not make fair deals with us, they will be 'Tariffed!'"
Industry groups reacted with dismay following the announcement.
In a statement on Monday, National Association of Manufacturers (NAM) President and CEO Jay Timmons said imposing the tariffs risked undoing the results that manufacturers have achieved in the past year because of tax and regulatory reforms.
"With every day that passes without progress on a rules-based, bilateral trade agreement with China, the potential grows for manufacturers and manufacturing workers to get hurt. No one wins in a trade war, and manufacturing workers are hopeful the administration's approach will quickly yield results," Timmons said, in the statement.
The White House has already levied tariffs on $50 billion worth of Chinese products. Beijing responded with measures targeting $50 billion on American goods, raising fears about damage to the American farm industry.
Some administration officials have pushed for additional talks with China as they try to ease tensions with the world's second-largest economy. But Trump contended last week that the U.S. was under "no pressure" to reach an agreement.