The United States announces substantial import taxes on Chinese products
The United States administration has announced plans to implement substantial tariff hikes on imports from China, targeting various sectors to safeguard domestic industries. This move includes a 100% tariff on Chinese-made electric vehicles, as confirmed by Reuters, citing information from U.S. Trade Representative Katherine Tai's office. A 50% tariff will be imposed on solar cells, while steel, aluminum, electric vehicle batteries, and essential minerals will face a 25% tariff. These new tariffs could come into effect as soon as September 27.
Lael Brainard, an economic advisor to the White House, justified these steps as efforts to separate the U.S. electric vehicle industry from China's dominant supply chain. Brainard argued that these "robust, precise" tariffs are essential to counter China's subsidies and technological transfer policies, which have resulted in excessive investments and production capacity. However, the U.S. administration also offers substantial tax incentives to bolster its own electric vehicle, solar, and semiconductor industries.
Brainard stated to Reuters that the 100% tariff on electric vehicles exemplifies the substantial unfair cost benefit that Chinese manufacturers have been exploiting to rapidly dominate international auto markets. The U.S. government, Brainard added, will not tolerate this situation.
China has lambasted the tariff hikes as bullying and indicated the potential for retaliation. China asserts that the success of its electric vehicle industry is a product of innovation, not state aid, and criticizes the increased U.S. tariffs as coming at a time when both Vice President Kamala Harris and former President Donald Trump are rallying voters in American automotive and steel-producing states. Both political figures are attempting to project themselves as firm on China in the run-up to the November presidential elections, with Trump promising 60% tariffs on all Chinese imports.
The Commission, headed by Katherine Tai, has been instrumental in confirming the proposed tariffs on Chinese-made electric vehicles and various other sectors. In response to Lael Brainard's justification, The Commission emphasizes that these tariffs are crucial to balance out China's subsidies and technological transfer policies.
