The Donald Trump administration has announced a flat 25% tariff on derivative products containing over 15% steel, aluminum, or copper.
This simplification of the previous system, which imposed tariffs based on metal content, will impact Korean exports of appliances like washing machines and refrigerators.
Reuters reported on Thursday that the administration unveiled plans to revise the metal tariff structure under Section 232 of the Trade Expansion Act. President Trump signed the proclamation, with changes taking effect at 12:01 a.m. on April 6 (ET).
The new structure exempts products with less than 15% metal content, such as perfume bottle caps and dental floss containers.
Items with 15% or more metal content, including washing machines and gas ranges, will face a 25% tariff.
This may slightly reduce tariffs for products previously above 50% metal content, while increasing them for those below.
The adjustment aims to simplify the complex tariff system that burdened importers with calculating metal content for each product.
A U.S. official told Reuters the new structure is simpler and clearer, expecting lower tariff burdens for most products.
The U.S. maintains the 50% tariff on raw steel, aluminum, and copper.
Tariffs on metal derivatives for power grids and industrial facilities drop from 50% to 15%, benefiting imports from Germany and Italy.
Products using American metals but made overseas face a 10% tariff, reflecting efforts to reshape supply chains.
Tariffs will now be based on U.S. sales prices, not import declaration prices, to prevent underreporting.
The administration expects minimal overall economic impact, though Reuters notes potential increased tax revenue.
U.S. Slaps 100% Tariffs on Drugs… 15% Rates for South Korea, Japan, EU
Trump also signed an order for high tariffs on imported pharmaceuticals.
Patent drugs not made in the U.S. without price agreements face 100% tariffs. Companies have 120-180 days to respond.
Relocating production to the U.S. reduces tariffs to 20%. The Most-Favored-Nation (MFN) agreements with the U.S. Department of Health and Human Services (HHS) waive tariffs. Seventeen firms are involved so far.
EU, Japan, Korea, and Swiss drugs face 15% tariffs. The UK has a separate agreement.
Generics are exempt for a year. Rare disease treatments and veterinary drugs are also exempt.
This aims to lower U.S. drug prices, which can be triple those in other developed nations.
Trump’s MFN policy pressures companies to match prices with other high-income countries.
Pfizer and Eli Lilly have three-year exemptions through government deals.
About half of PhRMA members haven’t joined, with smaller firms likely to negotiate individually to avoid tariffs.
