The technical issues in the Taiwan-US tariff negotiations have mostly been resolved, and the government is waiting for a concluding meeting with the US side, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said yesterday.
Once the meeting is held, a deal could be reached to lower the US’ “reciprocal” tariff rate and avoid stacking it on top of existing levies, Kung said on the sidelines of a meeting of the legislature’s Economics Committee in Taipei.
However, as the APEC summit is to be held in South Korea on Friday and Saturday next week, and the US still has meetings with ASEAN, the deal might not be finalized by the end of this month and could be delayed until the end of the year, he said.
Photo: Wang Yi-sung, Taipei Times
The minister’s remarks came after President William Lai (賴清德) on Tuesday said at a hardware expo in Taichung that there should be solid progress soon in negotiations over US tariffs on Taiwanese goods.
Lai said the government would strive to lower the current 20 percent tariff without it being stacked on top of existing levies and seek most-favored-nation treatment from the US regarding the outcome of a Section 232 investigation under the US Trade Expansion Act of 1962.
The negotiations did not involve discussions on exchange rate issues, he added.
As US President Donald Trump visits Asia, and the US and South Korea are expected to make progress in tariff negotiations to lower the rate to 15 percent — the same as Japan — lawmakers have raised concerns about potential pressure on Taiwanese manufacturers.
Taiwanese manufacturers have to compete with Japan and South Korea on many products, but the challenge lies in Taiwan’s much larger trade surplus with the US compared with the two countries, Kung said.
The government would negotiate to reach a better rate, he added.
While Taiwan’s tariff delegation is mainly focused on the manufacturing sector during the negotiations, the issue of importing US-made vehicles with lower levies is also part of the talks, Kung said, adding that if other countries attempt to circumvent tariffs by exporting cars to Taiwan through the US, the government would not allow it.
Under current regulations, imported cars are subject to a 17.5 percent tariff, while commodity tax rates range from 25 to 30 percent depending on the model. The key difference is that tariffs apply only to imported cars, while the commodity tax applies to imported and locally made vehicles.
The ministry said in June that the government is focused on negotiating the tariff rate first before addressing the commodity tax rate.
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