The presidential office said on the 24th that, regarding the Donald Trump administration's imposition of a 10–12.5% "forced labor tariff" on 60 countries including Korea under Section 301 of the Trade Act, "including the 'overcapacity' Section 301, which is still under investigation, we plan to consult closely with the U.S. side so that the finally agreed 15% between the two countries can be upheld."
The presidential office said the same day, "There is a consensus between Korea and the United States that the tariff agreement must be observed." It also said, "This time, the forced labor Section 301 tariff was imposed on 60 key countries depending on whether they have legalized an import ban on goods produced by forced labor."
The tariffs the United States seeks to levy under Section 301 of the Trade Act fall into two broad categories: ▲ the "forced labor" tariff released this time and ▲ the "overproduction" tariff currently under investigation. The forced labor tariff is levied on Korea's imports of products produced through forced labor in other countries, and the overproduction tariff is levied when it is determined that production facilities and actual output are excessive due to government support.
In addition to the forced labor measure released this time, another measure on overproduction is expected to come out in the future. Depending on the outcome of the investigation, there are concerns that combining the two tariffs could inadvertently exceed 15%. However, the presidential office plans to actively consult to ensure that the 15% agreed between the two countries is not exceeded.
◇ Trump counters "reciprocal tariff illegality ruling" with Sections 122 and 301 of the Trade Act
The Office of the United States Trade Representative (USTR) announced the previous day (local time) that it would impose tariffs on 60 countries that have not introduced and implemented a ban on the import of goods produced by "forced labor," under Section 301 of the Trade Act. Under this measure, Korea will in effect be subject to a 12.5% tariff.
On Feb. [date], the U.S. Supreme Court ruled that the reciprocal tariff imposed by President Donald Trump was illegal. In response, the USTR, separate from the reciprocal tariff, introduced a "10% global tariff" based on Section 122 of the Trade Act, which can be implemented for up to 150 days. As this provision expires at 12 a.m. on the 24th, the Section 301 investigation has been pursued as a substitute.
Accordingly, Korea will be subject to a 12.5% tariff rate along with the European Union (EU), Taiwan, Japan and Switzerland. However, depending on the outcome of the USTR's Section 301 investigation into "structural overproduction," it will be determined whether the United States will hold the line at the 15% tariff it promised our government.