The full text of a March 26 presidential proclamation imposing Section 232 tariffs of 25 percent on imported automobiles and auto parts indicates the following information regarding these tariffs.
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Automobiles
The tariffs took effect April 3 for passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans) and light trucks classified in HTSUS subheadings 8703.22.01, 8703.23.01, 8703.24.01, 8703.31.01, 8703.32.01, 8703.33.01, 8703.40.00, 8703.50.00, 8703.60.00, 8703.70.00, 8703.80.00, 8703.90.01, 8704.21.01, 8704.31.01, 8704.41.00, 8704.51.00, and 8704.60.00.
These tariffs apply even if the automobiles qualify for special tariff treatment under a free trade agreement or preference program, except that no tariffs will apply to the U.S. content of automobiles eligible for special tariff treatment under the U.S.-Mexico-Canada Agreement upon approval from the Department of Commerce. U.S. content refers to the value of the automobile attributable to parts wholly obtained, produced entirely, or substantially transformed in the U.S. The non-U.S. content will be calculated by subtracting the value of the U.S. content from the total value of the automobile.
The tariffs do not apply to automobiles classified in the above subheadings that (1) are not passenger vehicles or light trucks or (2) were manufactured in a year at least 25 years prior to the year of the date of entry.
Auto Parts
The tariffs will take effect May 3 for auto parts, which are defined to include engines and engine parts, transmissions and powertrain parts, electrical components, and parts of passenger vehicles and light trucks classified under the HTSUS subheadings enumerated in subdivision (g) of the annex.
These tariffs will apply to covered parts even if they qualify for special tariff treatment under a free trade agreement or preference program.
Parts eligible under the USMCA (other than automobile knock-down kits of parts compilations) are exempt from the tariffs. However, the proclamation indicates that this exemption should only apply until such time that the DOC establishes a process to apply the tariffs only to non-U.S. content.
The tariffs also will not apply to articles that are classified in the enumerated HTSUS subheadings but are not parts of passenger vehicles or light trucks.
Other
Covered products for which entry is claimed under a provision of HTSUS Chapter 98 will be eligible for, and subject to, the terms of such provision and applicable U.S. Customs and Border Protection regulations, except that duties under HTSUS subheading 9802.00.60 will be assessed based on the full value of the imported article.
No Chapter 99 claim that may set forth a lower rate of duty or provide duty-free treatment will be allowed for covered articles.
According to information from CBP, any automobiles (except those that are eligible for admission to a foreign-trade zone under domestic status and are admitted into an FTZ on or after 12:01 a.m. EDT on April 3) must be admitted as privileged foreign status. Such automobiles will be subject, upon entry for consumption, to the Section 232 tariffs as well as the rates of duty related to classification under the applicable HTSUS subheading in effect at the time of admission into the FTZ.
CBP also states that no drawback is available with respect to the Section 232 tariffs on automobiles.
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