PiCK

Trump Considers 'Double Strike' Reciprocal Tariffs... "Up to 50% on Cars"

Source

Korea Economic Daily

Summary

The Trump administration announced that it is considering the possibility of immediately imposing up to a 50% tariff using the Smoot-Hawley Tariff Act and the International Emergency Economic Powers Act.
It also reported that they are considering a two-track strategy to initiate an investigation of unfair practices before imposing tariffs through Trade Act 301.
Sources reported that President Trump could immediately apply import tariffs on vehicles on the 2nd of next month, which could significantly impact the global automotive industry.

Immediate Tariff Imposition with Smoot-Hawley Act

Investigation of Unfair Practices with Trade Act 301

Review of Obsolete Trade Act 122

Reports emerged on the 25th that U.S. President Donald Trump is considering a two-phase reciprocal tariff imposition.

The Financial Times (FT) cited a Trump administration official stating that they are considering a 'two-track strategy' to immediately impose reciprocal tariffs using the 'Smoot-Hawley Tariff Act' or the 'International Emergency Economic Powers Act', while simultaneously initiating an investigation for tariff imposition through Trade Act 301.

The official mentioned that there is a discussion on the possibility of imposing up to 50% tariffs through the Smoot-Hawley Tariff Act (1930 Tariff Act) or the International Emergency Economic Powers Act, which can be immediately enacted. On the other hand, applying Trade Act 301 requires an investigation into whether there were unfair practices before imposing tariffs.

It is known that the Trump administration is also looking into the virtually obsolete 'Trade Act 122'. If this provision is implemented, the U.S. government can impose a 15% tariff for up to 150 days.

Sources reported that President Trump could immediately apply import tariffs on vehicles on the 2nd of next month and could resume the investigation into the security impact on the global automotive industry, which was halted during the first trade war.

Reporter Kim In-yeop inside@hankyung.com