Dr Chalmers spoke face-to-face for the first time with US counterpart Scott Bessent in Washington overnight, alongside President Donald Trump's top economist, Kevin Hassett, for talks on duties on steel and aluminium imports.
Australia has just a few weeks left to secure a reprieve from Mr Trump, with the 25 per cent tariff on the metals imported into the United States due to come into effect by mid March.
Australia's treasury secretary, Steven Kennedy, said if the government does not secure an exemption, it should not respond by striking back with more trade restrictions.
"For a medium-sized economy such as Australia, there is overwhelming evidence that the use of trade restrictions imposes costs on our consumers and businesses," he told a Senate estimates hearing on Wednesday.
"If Australia were to impose tariffs, we would bear nearly all the cost, given our size and inability to affect the world prices of the goods we import."
Australia already showed how to respond successfully to trade tensions when China imposed restrictions on exports such as barley, coal and wine during the pandemic, he said.
"It will seem counterintuitive to many, but responding to tariffs or trade restrictions with similar measures will only make matters worse," Dr Kennedy said.
"Producers in the targeted industries were adversely affected.
"But governments did not compound the economic costs by implementing retaliatory tariffs or barriers that would have harmed Australian consumers and businesses, and in many cases, our exporters found alternative markets."
Speaking after his meeting with Mr Bessent, Dr Chalmers said their talks would not yield a conclusion to the planned tariffs on their own and any decision ultimately rested with President Trump.
"Australia has a different case to make than other countries who have been the focus of the administration," he told reporters.
"The Americans run a very substantial trade surplus with Australia.
"We don't manipulate our currency.
"Our products are often an input into domestic production here."
Asked about Australia's request, Mr Bessent said, "So far, so good. But I'm not USTR (United States Trade Representative)".
Trade Minister Don Farrell has yet to meet with his soon-to-be US counterpart Jamieson Greer, given he is yet to be confirmed in his role.
But there have been less welcoming noises coming out of the Trump camp, with trade adviser Peter Navarro accusing Australia of breaking a promise about limiting aluminium exports to the US and criticising its social media levy on US tech giants.
Asked if reports that Australia had exceeded a voluntary commitment not to export beyond a certain level of aluminium were brought up, Dr Chalmers said no.
He reiterated the strong economic ties between the two nations in a speech to US business leaders and Australian superannuation companies.
He called for more cooperation between the economies, saying Australia's $4.1 trillion pool of superannuation capital could be deployed in the US to help develop infrastructure projects such as toll roads and container terminals.
Mr Trump has said he is considering Australia's request for an exemption, as the Albanese government argues a trade surplus enjoyed by the US should spare the nation's exports.
