The much-awaited new tariffs imposed by President Joe Biden’s administration on Chinese electric vehicles and other important products have gone into effect.
The higher tariffs “will ensure that historic investments in jobs spurred by President Biden’s actions are not undercut by a flood of unfairly underpriced exports from China MCHI in areas like EVs, batteries, vital medical equipment, steel and aluminum, semiconductors SMH SOXX and solar TAN,” Lael Brainard, a top economic advisor to Biden, told reporters.
This action is being taken as Biden prepares for a tight 2024 presidential contest against former US President Donald Trump, who was well-known for his trade disputes with China. Recently, Trump has claimed credit for Biden’s impending tariff announcement, claiming that the incumbent Democratic senator “listens” to him. As the new tariffs were being implemented, the Biden White House chastised Trump’s 2019 trade agreement with China, claiming in a statement that the agreement had not increased US exports and citing an independent study to support this claim.
The new tariffs on Chinese goods, which were predicted for several days to take effect on Tuesday, are described in detail below. Biden is anticipated to discuss the levies at a White House speech that starts at 12:15 p.m. Eastern time.
- EVs: The White House announced that the tariff on Chinese electric vehicles will increase fourfold, from 25% to 100%. Additionally, all automobiles imported into the United States are already subject to an additional 2.5% duty.
- Batteries and essential minerals: The White House announced that the tariff on lithium-ion electric vehicle (EV) batteries will rise to 25% from 7.5% this year, while the tariff on non-EV lithium-ion batteries will also increase to 25%, but not until 2026. Furthermore, the tax on battery parts is scheduled to increase from 7.5% to 25% this year, and the tax on permanent magnets and natural graphite will increase from 0% to 25% in 2026; however, certain other essential minerals will also see an increase this year.
- Solar cells: According to the White House, the tariff rate on solar cells will rise from 25% to 50%, regardless of whether they are put together into modules.
- Semiconductors: By 2025, the 25% tariff on semiconductors is expected to rise to 50%.
- Medical supplies: The White House announced that this year, the tariff on syringes and needles will increase from zero to fifty percent. The tariff rates on some personal protective equipment, or PPE, such as respirators and face masks, are expected to increase from zero to 25% this year. In contrast, the tariff rates on rubber medical and surgical gloves will increase from 7.5% to 25% in 2026.
- Cranes: This year, the zero-percent tariff on ship-to-shore cranes is set to rise to 25%. Congressmen from the United States have been drawing attention to security issues with Chinese-made cargo cranes.
- Steel and aluminum: According to the White House, the tariff rate on some steel and aluminum products will rise to 25% this year from zero or 7.5%. A month ago, Biden stated that the tariffs his administration would impose on Chinese aluminum and steel could be tripled.
- What Biden officials are saying: Senior administration officials emphasized that the new tariffs are the outcome of a thorough review of Section 301 duties, which are named after a section of the Trade Act of 1974, and have nothing to do with politics. Additionally, officials insisted that the new taxes won’t raise prices for Americans or cause inflation.
