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2d ago

U.S. Cuts Tariffs on Japanese Autos to 15% as Reciprocal Rules Take Effect

The move implements a July deal tying relief to large Japanese investment commitments, triggering refunds under new reciprocal-tariff rules.

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Overview

  • The Commerce Department made the new rate effective at 12:01 a.m. ET on Sept. 16 by trimming the April add-on levy to 12.5% atop the longstanding 2.5% duty.
  • Reciprocal-tariff provisions set a 15% floor for items previously below that level, bar extra surcharges on goods above 15%, and apply refunds retroactive to Aug. 7, with certain items such as civil aircraft parts excluded.
  • President Trump signed a Sept. 4 order to implement the U.S.–Japan agreement, formalizing tariff relief tied to Japanese investment and purchase commitments reported at roughly $550 billion.
  • Industry groups welcomed reduced uncertainty, with the Japan Foreign Trade Council saying competitive concerns versus the EU and South Korea eased, though the 15% burden remains significant and cost sharing is unclear.
  • Legal risks persist as China and Brazil pursue WTO cases, a U.S. appeals court found the tariff authority exceeded in August, and the Supreme Court has scheduled oral arguments for November.