U.S. Federal Register officially publishes '15% tariff on Korean cars'

Korea Economic Daily

Summary

The U.S. government formally published in the Federal Register that it is lowering the tariff rate on Korean automobiles and auto parts from 25% to 15%.
The reduced tariff rate will be applied retroactively from the 1st of last month and applies to products imported or removed for consumption.
The move is part of implementing the 'Memorandum of Understanding (MOU) on Korea-U.S. Strategic Investment', and is expected to ease the burden on the Korean automobile industry with respect to the United States.

*Content related to tariff reduction published in the U.S. Federal Register. /U.S. Federal Register screenshot*

The U.S. government has officially posted a measure to lower the tariff rate applied to South Korea's automobile exports to the U.S. from the current 25% to 15%.

The U.S. Trade Representative (USTR) and the Department of Commerce's International Trade Administration (ITA) published this measure in the Federal Register on the morning of the 3rd (local time). The Federal Register amends the U.S. Harmonized Tariff Schedule (HTSUS) to lower the tariff rate on Korean products and automobiles and auto parts to 15%.

The U.S. government said that the combined tariffs — reciprocal tariffs and tariffs on automobiles, auto parts, and lumber — will not exceed 15%. The reduced tariffs on automobiles and auto parts will be applied retroactively as of 00:01 on the 1st of last month (U.S. Eastern Time) and apply to automobiles and auto parts imported for consumption or removed from warehouse for consumption.

A 15% tariff rate also applies to lumber, sawn timber, and derivative products. Civil aircraft and aircraft parts covered by the World Trade Organization (WTO) Agreement on Trade in Civil Aircraft are exempt from tariffs. Measures related to lumber and aircraft and aircraft parts will take effect from 00:01 on the 14th (U.S. Eastern Time).

*Passage stipulating the tariff reduction for automobiles and auto parts. /U.S. Federal Register*

This retroactive measure follows the ruling party, the Democratic Party, filing the 'Special Act for the Management of Korea-U.S. Strategic Investment' (Special Act on Investment to the U.S.) in 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, the parties agreed to make the tariff reduction retroactive to the first day of the month in which implementing legislation is submitted to the Korean National Assembly.

Washington=Lee Sang-eun, correspondent selee@hankyung.com