South Korea Sets the Record Straight on U.S. Import Tariffs

In a recent announcement, South Korea's Ministry of Economy and Finance corrected a widespread misconception regarding the tariff rate on U.S. imports. Contrary to some reports suggesting a 13.6% tariff, the actual rate stands at 0%, a benefit of the Korea-U.S. Free Trade Agreement (KORUS FTA). This pivotal agreement, operational since March 2012, has been instrumental in reducing trade barriers between the two nations.

Understanding the Tariff Reduction

The ministry highlighted that while the average most-favored-nation (MFN) tariff rate in Korea is about 13.4%, the landscape changes significantly with the implementation of FTAs. Countries with FTAs, including the United States, enjoy lower tariff rates. Last year, the average tariff rate on U.S. imports was 0.79%, with the effective rate even lower after refunds.

Looking Ahead

"According to the annual concession plans, the rate is expected to decrease further this year," the ministry added, signaling a continued commitment to enhancing trade relations. The KORUS FTA aims to progressively eliminate tariffs on most industrial and consumer products, a move that underscores the strategic importance of economic cooperation and market access between South Korea and the United States.