The United States has decided to lower tariffs on certain products including forklifts, bulldozers, and tractors to 15% for countries that have reached tariff agreements with Washington, including South Korea. The Korean government estimates that approximately $2.3 billion worth of exports to the US will benefit from the tariff cuts under this revision.
The Ministry of Trade, Industry and Energy (MOTIE) announced Tuesday that the US government issued a proclamation on November 1 (local time) revising Section 232 tariff measures under the Trade Expansion Act on steel, aluminum, and copper derivative products.
Under the revision, tariffs on certain mobile industrial machinery, including forklifts, bulldozers, and tractors, will be reduced from the existing 25% to 15%. However, the reduction will apply only when these products are imported from countries that have concluded tariff agreements with the US, such as South Korea, Japan, and Taiwan.
Agricultural equipment and air-conditioning systems, which had previously been subject to 25% tariffs, will see their tariff rates lowered to 15% regardless of whether a tariff agreement has been concluded. These tariff reductions will apply from the 8th of this month through December 31 next year.
The US government also eased the US-made steel usage requirement for qualifying for the lower tariff rate. Previously, products had to use at least 95% US-made steel to receive the 10% reduced tariff, but going forward, using just 85% will be sufficient to qualify for the lower rate.
In return, the US government added aluminum printing plates and steel racks, which had not originally been subject to Section 232 tariffs, to the list of tariff-targeted items and will impose a 25% tariff on them.
"The government has been urging the US side to grant Section 232 tariff reductions on various occasions, including through high-level bilateral consultations between Korea and the US," a MOTIE official said. "The exports to the US expected to benefit from tariff reductions under this revision are estimated at approximately $2.3 billion based on last year's exports to the US."
