U.S. Imposes New 12.5 Pct “Forced Labor” Tariffs on Japan, Others

Washington, July 24 (Jiji Press)–The U.S. government on Friday imposed new 12.5 pct tariffs on imports from Japan and dozens of other trading partners under Section 301 of the U.S. Trade Act, claiming that their import controls against goods produced through forced labor are insufficient. For Japan, the measure stipulates a preferential arrangement capping the combined tariff rate at 12.5 pct, including existing duties. While a temporary 10 pct universal substitute tariff, which had been introduced under Section 122 of the Trade Act, expired Friday, the implementation of the new “forced labor” tariffs ensured the seamless continuation of President Donald Trump’s signature tariff policy. On Thursday, the Office of the U.S. Trade Representative announced the new tariffs of up to 12.5 pct on 60 countries and regions that account for 99 pct of U.S. imports. Section 301 of the Trade Act allows the United States to impose punitive tariffs aimed at correcting unfair trade practices. While tariffs on imports from Japan rose from 10 pct, the East Asian country has been granted the special arrangement that caps the tariff rate under last year’s Japan-U.S. agreement. Japan and some other countries had agreed with the United States to limit reciprocal tariffs to a maximum of 15 pct, including existing duties, and U.S. Trade Representative Jamieson Greer had indicated that Washington would respect those trade agreements. The U.S. government imposed a tariff rate of 10 pct for 19 countries and territories, saying that their measures against imports of goods made with forced labor are not effective. For the remaining 41 economies, the rate was set at 12.5 pct. Five countries and regions, including Japan and the European Union, were granted special arrangements placing a cap on the tariff rate. The new tariffs will not be applied in addition to sector-specific tariffs, such as those on automobiles, steel, and aluminum. The tariff rate on the EU was capped at 10 pct, while an additional 12.5 pct tariff was imposed on China. India and other countries that had initially been proposed for a 12.5 pct rate were assigned a 10 pct rate following system changes. After the U.S. Supreme Court ruled in February that the reciprocal tariffs and related measures imposed under the International Emergency Economic Powers Act were invalid, the U.S. government implemented the blanket 10 pct alternative tariff applied worldwide under Section 122 of the Trade Act as a temporary bridging measure, limited to a period of 150 days. The USTR had been conducting Section 301 investigations for the introduction of the new tariffs since March. In June, it identified inadequate measures against imports produced with forced labor as a concern and proposed imposing tariffs of up to 12.5 pct. Under Section 301 of the Trade Act, the USTR is also investigating 16 countries and regions, including Japan, on issues such as bilateral trade surpluses with the United States and overproduction. It plans to complete the investigations as soon as possible and move forward with the imposition of related tariffs. END [Copyright The Jiji Press, Ltd.]