What Countries Charge the US

Trump’s point is well taken. There is a disparity between the US and its largest trading partners. Well taken or not, the economic harm from tariffs is not easy to take.

Many countries have “extremely” complicated tariff systems: different rates on different products. In National Review Online, Jim Geraghty tries to sort through it all and explain to readers what’s going on.

Using information from the U.S. Department of Commerce’s International Trade Administration, Mr. Geraghty explains which of our biggest trading partners have higher tariffs on our goods than we charge on theirs. Some countries charge relatively low tariffs. Japan and Taiwan, for example, aren’t really problems. They charge relatively low tariffs.

Other countries’ tariff systems are more complicated than others (different rates on different products). Mr. Geraghty is trying to help readers make heads and tails out of the tariff kerfuffle, by quoting the simplest summaries from USDCITA:

Argentina: since 2019, the average rate is 22%.

Australia: “Since July 2018, GST [Goods and Services Tax] of 10 percent applies to sales of low value imported goods to consumers.”

Brazil: “Imports are subject to several taxes and fees in Brazil, which are usually paid during the customs clearance process. There are three taxes that account for the bulk of import costs: Import Duty, Industrialized Product tax, and Merchandise and Service Circulation tax. In addition to these taxes, several smaller taxes and fees apply to imports. Note that most taxes are calculated on a cumulative basis.”

Canada: “U.S. companies shipping to Canada should be aware that Canada’s de minimis threshold is Canadian $40 (approximately US $31) for taxes and Canadian $150 (approximately US $116.50) for duties. By comparison, in March 2016, the United States raised its de minimis threshold from US $200 to US $800. Some stakeholders, particularly shipping companies and online retailers, maintain that Canada’s low de minimis threshold creates an unnecessary trade barrier.”

China: Import tariff rates are divided into six categories: general rates, most-favored-nation (MFN) rates, agreement rates, preferential rates, tariff rate quota rates, and provisional rates. Since China is a member of the WTO, imports from the United States are assessed at the MFN rate. The five Special Economic Zones, open cities, and foreign trade zones within cities offer preferential duty reductions or exemptions. Companies doing business in these areas should consult the relevant regulations.” Chinese regulations are complicated from product to product, but as of 2022, according to the World Bank, China’s MFN rate is 7.57 percent.

ITA’s most recent assessment of the European Trade Union (from 2020):

“The EU’s average Most Favored Nation (MFN) applied tariff rate was 5.2 percent in 2018 (latest data available). The EU’s average MFN applied tariff rate was 12 percent for agricultural products and 4.2 percent for non-agricultural products in 2018 (latest data available). The EU has bound 100 percent of its tariff lines in the WTO, with a simple average WTO bound tariff rate of 5.1 percent. Although the EU’s tariffs are generally low for non-agricultural goods, there are some high tariffs that affect U.S. exports, such as rates of up to 26 percent for fish and seafood, 22 percent for trucks, 14 percent for bicycles, 10 percent for passenger vehicles, 10 percent for processed wood products, and 6.5 percent for fertilizers and plastics.”

According to the EU, VAT should not be considered a tariff.

“Value-Added Tax (VAT) is a consumption tax, similar to sales taxes in the United States, and is used in over 170 countries worldwide. It is applied on a non-discriminatory basis, regardless of where a product is made. Any company selling goods for consumption in the EU — whether foreign or domestic — must pay VAT. EU-produced goods pay exactly the same VAT as any imported goods. VAT is not a trade measure, let alone a tariff. It is clearly not a measure applied exclusively to foreign goods like an import tariff.”

India: The tariff rate varies considerably from one good to another, but according to India Briefing, “India imposes an average tariff of 17 percent.”

Indonesia: “U.S. stakeholders have asserted that Indonesia is applying tariffs in excess of its WTO bound rates for certain categories of information and communications technology (ICT) products. Since at least 2020, Indonesia appears to be applying a 10 percent duty [on] switching and routing equipment, and a 5 percent duty on computer servers.”

Japan: “The average applied tariff rate in Japan is one of the lowest in the world. Simple average applied Most Favored Nation (MFN) tariff for Japan, according to the WTO data, is as follows: all products — 4.3 percent; agriculture products — 15.5 percent; non-agriculture — 2.5 percent.”

South Korea: “Korea has a flat 10 percent Value Added Tax (VAT) on all imports… A special excise tax of 10-20 percent is also levied on the importation of certain luxury items and durable consumer goods.”

Malaysia:

Malaysia’s tariffs are typically imposed on a value-add basis, with a simple average applied tariff of 6.1 percent for industrial goods. For certain goods, such as alcohol, wine, poultry and pork, Malaysia charges specific duties that represent considerably higher effective tariff rates. Duties for tariff lines where there is significant local production are often higher. The Ministry of Finance (MOF) announced on July 16, 2018, that the Sales and Services Taxation (SST) is chargeable on the manufacture of taxable goods in Malaysia. The SST is also applied to the importation of taxable goods into Malaysia at the rate of 5 or 10 percent, or a specific rate depending on the category of products.

Mexico: “There are no tariffs for products made in the United States that meet rules of origin requirements under the United States-Mexico-Canada Agreement (USMCA). However, there are several exceptions and caveats noted below that may affect the overall pricing of U.S. exports.”

Russia: The U.S. Commercial Service Russia suspended operations on July 15, 2021, due to the Russian government’s ban on locally employed staff. Russia’s invasion of Ukraine on February 24, 2022, has severely affected bilateral commercial relations. . . . U.S. export statistics from 2023 show roughly a 90 percent drop in U.S. exports compared to 2021, the last year before Russia re-invaded Ukraine.”

Saudi Arabia:

As a member of the Gulf Cooperation Council, it applies the GCC common external tariff of at least five percent to be levied on most goods imported from countries outside the GCC. . . . Saudi Arabia imports over $1.5 billion worth of U.S. agricultural products annually, making it among the top 20 U.S. agricultural export markets. Most food products are subject to a 5 percent import duty. Selected processed food products, however, are assessed higher rates depending on the self-sufficiency level of the Kingdom aimed at protecting local food processors and production from competitively priced imports.

South Africa: “The value-added tax (VAT) is 15 percent. VAT is payable on nearly all imports.”

Switzerland: “Switzerland tends to impose low tariff rates on overall imports. In 2019, the trade-weighted average applied rate was 1.7 percent, according to the WTO. While non-agricultural goods from MFN countries only faced a simple average tariff rate of 1.3 percent in 2020, duties of 30.4 percent were applied to agricultural goods on average, and these rose to 137.7 percent for dairy products.”

Taiwan: “In 2023, the average nominal tariff rate for industrial products is 4.13 percent and 15.06 percent for agricultural products. The overall average nominal tariff rate for imported goods was 6.34 percent, according to Taiwan Customs.”

Thailand:

Thailand’s average Most-Favored-Nation (MFN) applied tariff rate was 11.5 percent in 2021 (latest data available). Thailand’s average MFN applied tariff rate was 31.2 percent for agricultural products and 8.4 percent for non-agricultural products in 2021. . . . High tariffs in many sectors continue to hinder access to the Thai market for many U.S. products. The highest ad valorem tariff rates apply to imports competing with locally produced goods, including automobiles and automotive parts, motorcycles, beef, pork, poultry, tea, tobacco, flowers, beer and spirits, and textiles and apparel. Wine imports are subject to a 54 percent tariff and six different taxes; taken together, the effective duty and tax burden is nearly 400 percent.

Turkiye: “Türkiye applies the common external tariff (CET) to industrial goods, and its most-favored nation (MFN) tariffs on non-agricultural products on average of 5 percent. . . . VAT for most agricultural products ranges from 1 percent to 10 percent but may be as high as 20 percent for certain processed products. . . . Since 2018, U.S. spirits and liquors face an additional 70 percent tariff.”

(Mr. Gerhaghty notes: the Trump administration has kept the Biden administration’s policy of spelling “Turkey” as “Türkiye.” The Turks didn’t like the fact that their country’s name has the same pronunciation and spelling as what we eat for Thanksgiving.)

United Kingdom: “Import prices for products entering the UK generally consist of: Cost, Insurance, Freight and Duty, with a standard VAT of 20 percent levied at the border on the aggregate value. VAT is reduced to 5 percent for some goods and services such as children’s car seats and home energy. VAT is further reduced to zero for certain goods such as food and children’s clothing.”

Vietnam: “Most U.S. exports now face tariffs of 15 percent or less. However, in recent years, Vietnam has increased applied tariff rates on several products, and although the rates remain below its WTO-bound levels, foreign businesses have been affected by the increases. Most of the products for which tariffs have increased are produced by Vietnamese companies.”

Some countries impose tariffs higher than we impose on goods imported from them, explains Geraghty.

Yes, the U.S. imposes all kinds of tariffs, but — at least before Trump started imposing and reimposing them — they were generally on the lower side: “The effective tariff rate on all U.S. goods imports (import duties as a share of total goods imports) averaged 2.3 percent in 2023, ranging from 0.1 percent for oil and gas products to 12.4 percent for textile products.”)

Even before Donald Trump returned to the White House, the US had its own unfair protectionist tariffs in place on certain goods.

• Brazilians grumble about U.S. limits on imported sugar.
• Koreans bemoan U.S. tariffs on light trucks.
• Chinese gripe about restrictions that prevent their smartphone makers from selling in the U.S. market.

Before Trump’s recent trade moves, the U.S. had one of the most open economies on Earth. That is, unless you were trying to sell Americans foreign-made pickup trucks, clothing, tobacco, cereal, or several dozen other products. In that case, the U.S. government charges double-digit import taxes designed to discourage consumers from buying foreign goods and to protect domestic producers.

Some US companies are paying a significantly higher rate to sell their goods there than they pay to sell their goods here.

That does seem at least a little unfair, doesn’t it? For example, in India, “The gap is even wider in agriculture, where India’s simple average tariff is 39 percent, compared to five percent in the U.S.”

A question, Mr. Geraghty. Since Donald Trump returned to the White House, are there any countries proposing a reduction on their tariffs on goods imported from the United States?

JG: Vietnam made this move a few days ago:

Vietnam will cut its tariffs on several U.S. products, including LNG and cars. It moved to approve Starlink services, as the country tries to avoid being hit with U.S. tariffs because of its large bilateral trade surplus.

Under the new plans revealed late on Tuesday, the tariff on American liquefied natural gas will be cut to 2 percent from 5 percent, on automobiles to 32 percent from a range of 45 percent to 64 percent, and on ethanol to 5 percent from 10 percent, the head of the Finance Ministry’s tax policy department Nguyen Quoc Hung said in a statement posted on the ministry’s website.

From Bloomberg News: “The European Union is identifying concessions it’s willing to make to Donald Trump’s administration to secure the partial removal of the US tariffs that have already started hitting the bloc’s exports and that are set to increase after April 2.”

Jim Geraghty has an idea: Instead of a trade war with every country raising its tariffs, how about a competition where each country tries to impose as low as possible tariffs?

In a move that has the look of trying to quickly resolve trade disputes, on Tuesday, Israel’s Prime Minister Benjamin Netanyahu posted on X:

Today we cancelled all of the customs duties levied on products from the US, Israel’s largest trading partner. Cancelling the customs duties on American goods is an additional step in the policy that my governments have led for a decade in opening up the market to competition, introducing variety to the economy and lowering the cost of living. In addition to the advantages to the market and to citizens of Israel, the current effort will allow us to further strengthen the alliance and ties between Israel and the US. We will continue to work to reduce barriers and customs, and bolster our special relationship with the US.