The Donald Trump administration in the United States has decided to reduce the tariff burden on corporations that manufacture cars in the United States using imported parts.
On the 29th (local time), a U.S. Department of Commerce official noted in a briefing that no tariff of 25% will be levied on an amount equivalent to 15% of the manufacturer's suggested retail price (MSRP) of cars completed in the United States. The official explained that the 15% is an offset, not a later refund of the tariff.
In the first year, the offset ratio is 15%, which effectively lowers the original 25% tariff by 3.75% (0.15 x 0.25 = 0.0375 points). In the second year, the offset ratio will decrease to 10%, and from the following year, no offset benefit will be provided.
The official explained that it was decided not to impose a tariff on the 15% since it is impossible for the auto industry to procure 15% of the car parts in the United States, regardless of their efforts. He said, "All cars that are completed in the United States with a domestic content ratio of over 85% will have no tariffs at all."
The United States has been imposing a 25% tariff on automobiles since April 3rd, and this tariff will be expanded to include auto parts starting May 3rd.