Tariffs coming for China imports like EVs
The Biden administration is set to announce new tariffs as high as 100% on Chinese electric vehicles and additional import taxes on other Chinese goods, including semiconductors, as early as next week, according to people familiar with the matter.
The move comes amid growing concern within the administration that President Joe Biden’s efforts to jumpstart domestic manufacturing of clean energy products could be undercut by China, which has been flooding global markets with cheap solar panels, batteries, electric vehicles and other products.
The long-awaited tariffs are the result of a four-year review of the levies that President Donald Trump imposed on more than $300 billion of Chinese imports in 2018. Most of the Trump tariffs are expected to remain in place, but Biden plans to go beyond those by raising levies in areas that the president showered with subsidies in the 2022 Inflation Reduction Act.
That includes Chinese electric vehicles, which currently face a 25% tariff. The administration is expected to raise that to as much as 100% in order to make it prohibitively expensive to buy a Chinese EV.
Biden has previously raised concerns about Chinese electric vehicles, saying that internet-connected Chinese cars and trucks posed risks to national security because their operating systems could send sensitive information to Beijing. He took steps earlier this year to try to block those vehicles from entering the United States.
The president is looking to ratchet up pressure on China and demonstrate his willingness to protect American manufacturing before his faceoff against Trump in the November presidential election.
The fate of the China tariffs has been the subject of intense debate within the White House since Biden took office, with economic and political advisers often clashing over how to proceed. But this year, China has begun ramping up production of the same products — electric vehicles, lithium batteries and solar panels — that the Biden administration has been investing billions of dollars to start producing in the United States.
Beijing’s move has re-inflamed trade tensions between the two countries, compelling Biden to press ahead with more aggressive trade restrictions.
Trump has said he would escalate his trade war with China if reelected and said this year that he was considering imposing tariffs of 60% or more on Chinese imports. In March, Trump said he would impose a 100% tariff on cars made in Mexico by Chinese companies.
The scale of the Biden administration’s tariffs, which are expected to be applied to Chinese electric vehicles, batteries and solar products, is not clear. The new tariffs on Chinese electric vehicles are not expected to apply to traditional gasoline-powered cars that are made in China, according to a person familiar with the plans.
The planned release of the review, which is being conducted by the Office of the U.S. Trade Representative, was reported earlier by Bloomberg News.
Strategic tariffs are also expected to include new levies on semiconductors, which Biden sought to boost in the bipartisan CHIPS and Science Act, a 2022 law that includes grants and other incentives for chipmakers.