U.S. Commerce Secretary: "Korea car tariffs retroactively reduced to 15% as of November 1"

Howard Lutnick, U.S. Commerce Secretary, said on the 1st (local time) that, under the trade agreement between Korea and the United States, tariffs on Korean-made automobiles will be retroactively reduced to 15% from last month.

In a statement posted on X (formerly Twitter) by the Commerce Department that day, Secretary Lutnick said, "Korea has moved formally to implement the Strategic Investment Act in the National Assembly," and added, "This critical step ensures that American industries and workers can reap the full benefits of President (Donald Trump)'s trade agreement with Korea."

He went on to say, "Accordingly, the United States will reduce certain tariffs under the agreement, including setting automobile tariffs at 15% effective November 1."

Secretary Lutnick said, "We will also eliminate tariffs on aircraft parts and align Korea's reciprocal tariffs (country-specific tariffs) with those of Japan and the European Union (EU)."

Secretary Lutnick's statement that day was a follow-up to the ruling party, the Democratic Party of Korea, having introduced the 'Special Act for the Management of Korea-U.S. Strategic Investment' (Special U.S. Investment Act) to the National Assembly on the 26th of last month.

In the 'Memorandum of Understanding (MOU) on Korea-U.S. Strategic Investment' signed by the two countries on the 14th of last month, it was agreed that tariff reductions under the MOU would be applied retroactively to the first day of the month in which the implementing legislation is submitted to the Korean National Assembly.

With the introduction of the Special U.S. Investment Act, which was the condition for the retroactive reduction of automobile tariffs, Secretary Lutnick has officially confirmed the reduction of automobile tariffs and their retroactive application.

Korea expects that the official U.S. legal procedure of publishing the tariff changes in the U.S. Federal Register will also take place soon.

Earlier, MOTIE announced that on the day the bill was introduced, Minister Kim Jeong-gwan sent a letter to Secretary Lutnick informing him that the bill had been submitted to the National Assembly and requesting the prompt publication in the Federal Register, including the retroactive application of tariff reductions on automobiles and parts as of November 1.

Secretary Lutnick said, "Korea's commitments to U.S. investment strengthen our economic partnership and U.S. jobs and industry. We also appreciate the deep trust between the two countries," and added, "I look forward to continuing to work closely with Korea to build a stronger and more prosperous future for both countries."

Choi Su-jin, Hankyung.com reporter naive@hankyung.com