After months of negotiation, the US and China have announced that they have come to an agreement on trade. The US will cut the current taxes on $120 billion of Chinese goods from 15% down to 7.5% and has decided to not move forward with adding tariffs to the rest of the $160 billion Chinese goods. This will take effect on December 15, 2019. A 25% tariff rate will continue to stay in place on approximately $250 billion worth of US goods. In return, China has agreed to increase its purchases of US goods and services along with around $40-50 billion in agriculture products.
Reports from the White House and the Office of the United States Trade Representative (USTF) announce that a Phase 1 agreement with China has been reached with a significant impact on the current and pending changes.
The trade-remedy tariffs under List 4B will not go into
effect on December 15, 2019, as previously announced. This action
has been suspended indefinitely.
trade-remedy tariffs under List 4A will remain in effect but at a reduced
rate. The current rate of 15% will be dropped to 7.5%.
trade-remedy tariffs under Lists 1-3 will remain at 25% for the time
being. These tariffs are being retained to be used as a negotiation
point during Phase 2, which is anticipated to commence soon after this
Phase 1 is signed.
Official implementing instructions need to be published which will likely provide specifics, for example, the effective date and time and event of the 4A reduction. This may not occur until the agreement is signed with China in early January.