Section 232 Tariffs: U.S Imposes Additional Duties on Steel and Aluminum
The U.S. has implemented Section 232 Tariffs, imposing a 25 percent duty on steel and a 10 percent duty on aluminum imports to safeguard national security. These tariffs have led to significant changes in business practices for importers in the steel and aluminum sectors.
- The tariffs took effect on March 23, 2018, affecting goods entering or withdrawn for consumption.
- Initially, some countries were exempt from the duties, but this changed on June 1, 2018, as exemptions were reduced.
- Australia remains the only country exempt from these tariffs, while South Korean aluminum articles face additional duties.
Section 232 tariffs are additional duties imposed by the U.S. government on imported steel and aluminum products. Specifically, these tariffs include a 25 percent duty on steel and a 10 percent duty on aluminum, significantly impacting importers and altering their business practices.
Section 232 Tariffs on Aluminum and Steel
Importers in the trade of Steel and Aluminum are beginning to experience changes to their business practices after Section 232: Tariffs on Aluminum and Steel took effect. This resulted in a 25 percent duty on steel products and a 10 percent duty on aluminum products imported.
Under Section 232 of the Trade Expansion Act of 1962, the U.S Administration issued Proclamation 9704 and 9705 on Adjusting Imports and Steel and Aluminium into the country.
On March 23, 2018, goods that entered, or withdrawn from warehouse for consumption were affected by the duty requirements. More importantly, The basis for Section 232 is on the country of origin, not the country of export.
At the beginning stages of Section 232, certain countries were exempt from the raised duty rates. However, On May 31, 2018, the President issued Proclamations which ended temporary exceptions of duties for imports of steel and aluminum products from the European (EU), Canada, and Mexico.
Why are the rates increasing?
Section 232 deals with Safeguarding National Security. This implies that action may be taken if an article is being imported into the United States in such quantities or under such circumstances as to threaten to impair the national security.
Investigations and reports all point to the conclusion that the circumstances and quantities of steel and aluminum imports threaten to impair national security. This gives then gives the President full authority to enact and/or redact based on investigations. In this case, the action is an increase in tariffs and aluminum imports.
You may view a short version of the administration’s statement here.
How does this affect importers of Steel and Aluminum?
Two specific imports are affected by this Presidential Proclamation; steel mill and aluminum articles. The new duty rates for these commodities are the following:
10% tariff on aluminum
The U.S Administration did not immediately enforce this in all countries. In the initial stage, some countries will be exempt from this raised duty rate but will change as time progresses.
Steel Tariff Effectivity
From May 1, 2018 to May 31, 2018
May 2018: All countries of origin except Mexico, Argentina, Canada, Australia, Brazil, South Korea, and member countries of the European Union.
As of June 1, 2018: All countries of origin except Australia, South Korea, Brazil, and Argentina
Aluminum Tariff Effectivity
May 2018: All countries of origin except Mexico, Argentina, Canada, Australia, Brazil, South Korea, and member countries of the European Union.
As of June 1, 2018: All countries of origin except Argentina, Australia, and Brazil.
Important notes:
- The only country exempted from the tariffs and not subject to quotas is Australia.
- South Korean Aluminum articles are also subject to additional import duties under Section 232.
- For both steel and aluminum, imports of United States origin are not covered by the Section 232 measures.
For a full look at this legislation from Customs and Border Protection, read the full breakdown on Section 232 on the CBP website.
Are you concerned about how this affects your business? Call 303‑365‑1000 or email us anytime.