Modifying Reciprocal Tariff Rates To Reflect Discussions With China
May 21, 2025
May 21, 2025
Summary
Reduces and pauses extra import taxes on goods from China for 90 days to show goodwill during talks about unfair trade.
What problem does this solve?
The U.S. had high import taxes on Chinese goods because of unfair trade, and China responded with its own taxes. This order lowers the U.S. taxes for 90 days as a positive step while both countries talk to solve the trade problems.
Who does this affect?
- Importers of Chinese goods
- U.S. consumers
- People's Republic of China
What does this order do?
Temporarily suspends high tariffs on Chinese goods
Pauses for 90 days the extra import taxes placed on goods from the People's Republic of China, including Hong Kong and Macau.
Sets a new temporary import tax rate
Sets a new, lower additional import tax of 10 percent on all goods from China during the 90-day suspension period.
Lowers taxes on small, low-value shipments
Reduces the extra tax rate on certain low-value imports from 120 percent down to 54 percent.
Keeps a fee on postal items
Maintains the $100 fee for each postal package containing certain goods and cancels a planned increase to $200 that was set for June 1, 2025.
Updates the official U.S. tariff list
Makes specific technical changes to the Harmonized Tariff Schedule of the United States (HTSUS) to reflect the new, lower tax rates.
What is the real world impact?
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Acts as a de-escalation in a trade war
Lowers tariffs as a sign of good faith, potentially to encourage China to make concessions in trade negotiations. This could be seen as a way to ease economic tensions that harm both countries.
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Responds to economic pressure
High tariffs can increase costs for American businesses and consumers. Reducing them, even temporarily, could provide economic relief and be a popular move with industries that rely on Chinese imports.
When does this start?
The new, lower import taxes take effect at 12:01 a.m. eastern daylight time on May 14, 2025, with some changes lasting for 90 days.
Suspension of high tariffs
The higher import taxes on Chinese goods are suspended for a 90-day period starting at 12:01 a.m. on May 14, 2025.
New tax rate for low-value shipments
The tax rate for certain low-value imports is lowered to 54 percent starting at 12:01 a.m. on May 14, 2025.
Cancellation of future fee increase
Cancels a planned increase of the per-postal-item fee that was scheduled to happen on June 1, 2025.