Will Taiwan's 10% Tariff Rate Have Exceptions? Cheng Li-chun Reveals 'This Investigation' Not Yet Released, Trump's 301 Tariff Exemption List Overview

U.S. President Donald Trump has launched another trade initiative. The U.S. government announced new tariff measures under Section 301 of the Trade Act of 1974 targeting major global trading partners. On the 24th, Taiwan’s Executive Yuan stated that the Office of the United States Trade Representative (USTR) has officially released the final action of its '301 investigation on forced labor imports,' imposing a 10% tariff on Taiwan without叠加 of Most Favored Nation (MFN) rates, and granting a partial product exemption list tailored for Taiwan.

Cheng Li-chun, Vice Premier of the Executive Yuan and convener of the Taiwan-U.S. Economic and Trade Working Group, stated that Taiwan will continue close communication with the U.S. and closely monitor the outcome of the separate 'structural overcapacity' 301 investigation to safeguard Taiwan’s and its industries’ best interests.

What is the Section 301 investigation? What is Taiwan’s tariff rate?

On April 23 (U.S. Eastern Time), the USTR announced it would impose tariffs ranging from 10% to 12.5% on 60 economies deemed to have failed to implement and effectively enforce bans on forced labor imports, under Section 301 of the Trade Act. The Executive Yuan explained that after the legal basis for U.S. reciprocal tariffs expired, the U.S. had initially applied a temporary 10% tariff uniformly on all countries under Section 122 of the Trade Act of 1974,叠加 with existing MFN rates, with the measure set to expire on July 24.

To rebuild the legal foundation for tariffs, the U.S. simultaneously launched two 301 investigations: one on 'forced labor' and another on 'structural overcapacity.' The final action on the former has now been officially released, covering the top 60 trading partners, which account for 99.4% of total U.S. imports.

According to the U.S. final determination, the tariff rates are as follows:

10% Tariff: Argentina, Bangladesh, United Kingdom, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Pakistan, Sri Lanka, Trinidad, Tobago.

10% or 12.5% Tariff: Taiwan (10%), European Union, Japan, South Korea, Switzerland. (Tariff calculated in combination with MFN)

12.5% Tariff: China, Japan, South Korea, Singapore, and 38 other countries.

Has the 301 investigation outcome been fully released? What did Cheng Li-chun say?

Cheng Li-chun stated that the U.S. acknowledged Taiwan’s commitments under the U.S.-Taiwan Agreement on Trade (ART) regarding banning forced labor imports, which is why Taiwan is subject to a 10% tariff under Section 301 without叠加 of existing MFN rates, and has received a tailored exemption list. She noted that the U.S. has not yet released the final results of the 'structural overcapacity' 301 investigation. After both investigations conclude, the U.S. will determine the final tariff arrangements. The government will continue to maintain Taiwan’s current treatment through the ART and bilateral cooperation mechanisms.

The Executive Yuan further clarified that under this measure, Taiwan and the EU are recognized for having committed to enforcing bans on forced labor imports, and thus are subject to a 10% tariff without叠加 of MFN rates (if the original MFN rate is already 10% or higher, no additional 301 tariff will be imposed).

Cheng Li-chun emphasized that Taiwan will continue to monitor the outcome of the 'structural overcapacity' 301 investigation. (Photo credit: Ko Cheng-hui)

Which items are included in Taiwan’s tariff exemption scope?

Regarding exemptions, the Executive Yuan stated that excluded items include informational materials, donated goods, personal luggage of travelers, and all goods and their components already subject to U.S. Section 232 tariffs. Additionally, certain products critical to supply chains and economic security are excluded, including those that could cause shortages in the U.S., disrupt overall economic operations, or cannot be self-supplied by the U.S. or sourced from alternative suppliers. Furthermore, products that encourage Taiwan, the UK, Switzerland, Malaysia, Indonesia, and other economies to implement bans on forced labor imports may also qualify for exemptions.

The Taiwan-U.S. Economic and Trade Working Group will continue to confirm the details of the exemption list with U.S. authorities. Once finalized, the actual product scope and related content applicable to Taiwan will be announced publicly.