US Implements Section 232 Tariff Relief for Non-Semiconductor Taiwanese Products; Auto Parts Taxed at 15%

Taiwan and the US signed an investment MOU in January this year, making Taiwan the first country in the world to receive preferential treatment under the US Section 232 trade law. The Executive Yuan announced on the evening of the 27th that the US government indicated on the 27th (US Eastern Time) that it would soon publish a notice in the Federal Register, officially announcing the Section 232 tariff relief measures for non-semiconductor products as specified in the MOU, effective May 1. These measures include capping tariffs on auto parts, raw wood, timber, and wood-derived products at 15%, and exempting steel, aluminum, and copper derivatives used in aerospace parts from Section 232 tariffs. Deputy Premier Cheng Li-chun stated that the implementation of these measures will help enhance the overseas competitiveness of Taiwan's related industries and allow for further expansion into the US market. The Executive Yuan noted that the US has not yet imposed Section 232 tariffs on semiconductors and their derivatives from Taiwan. Regarding non-semiconductor products, Taiwan and the US maintained communication throughout March and April, advocating for the immediate implementation of relief for items already subject to Section 232 tariffs. Following a detailed review of the tariff schedule and US interagency administrative procedures, the US is expected to publish the notice in the Federal Register soon. Regarding specific tax adjustments: First, the tariff on 'auto parts' is reduced from an average of approximately 26.71% to 15%. Second, for raw wood, timber, and wood-derived products, specifically 'certain upholstered wood products, kitchen cabinets, vanities, and their parts,' the tariff is reduced from an average of 25% to 15%. Third, the tariff on 'steel, aluminum, and copper derivatives in aerospace parts' is adjusted from previous rates ranging from 15% to 50% plus MFN, to an exemption from Section 232 tariffs, with only MFN rates applied.