On Sept. 13, 2024, following the conclusion of the U.S. trade representative’s (USTR) statutory review of Section 301 tariffs, the Biden administration announced final increases on tariffs on certain Chinese-origin goods. These tariff increases will affect duties on imports from China across strategic manufacturing sectors including electric vehicles, batteries, solar cells, semiconductors, medical products, minerals and materials including steel and aluminum.
Section 301 tariffs will increase for specific imports, to between 25% to 100% beginning Sept. 27, 2024, with other rates scheduled to increase in 2025 and 2026 for Chinese-origin semiconductors, medical products, lithium-ion non-electrical vehicle batteries, permanent magnets and natural graphite.
Changes in the Final Tariffs
Following its original proposal to increase tariffs on Chinese-origin goods in May 2024, USTR received over 1,100 comments during the public comment period. The tariff increases proposed in May were largely adopted, with exclusions for “ship-to-shore” cranes and enteral syringes.
Below is a summary of some of the tariff increases:
The final tariffs and their respective date of enforcement are listed below:
Rate Increases Effective in 2024
*Tariff increases effective in 2024 apply to products imported on or after Sept. 27, 2024.
Rate Increases Effective in 2025
*Tariff increases effective in 2025 apply to products imported on or after Jan. 1, 2025.
Rate Increases Effective in 2026
*Tariff increases effective in 2026 apply to products imported on or after Jan. 1, 2026.
The final tariff increases will significantly impact the price of goods imported from China. U.S. policymakers have also anticipated that once the tariffs are in place, the Chinese government will retaliate through new or increased tariffs on U.S. products. It remains important for companies to assess the extent to which the final tariffs will impact their operations as well as future developmental activities and the extent to which any existing or proposed development activities may benefit from any announced exclusion process.
All stakeholders in the energy space will need to assess the impact of the final tariffs under existing procurement, construction and other related development contracts and consider how to address these tariffs and exclusions in any contracts yet to be executed.
