US lowers tariffs to boost investment in industrial economy
Tariffs on agriculture, construction equipment to drop to 15% from 25%
The White House said it will reduce tariffs on farm and construction equipment such as harvesters and forklifts, in an effort to boost investment in the industrial economy through next year.
Under a proclamation issued late Monday, those import taxes would drop to 15% from 25%. Foreign companies could qualify for a lower 10% duty rate if capital equipment contains at least 85% US steel or aluminum, according to a White House fact sheet.
The changes take effect June 8 and would run through the end of 2027.
The temporary relief will “spur near-term investments that will rebuild the Nation’s industrial base,” the fact sheet said.
Trump’s directive is his latest effort to adjust steel and aluminum duties dating back to his first administration — using so-called 232 authority that has broadly produced mixed results on growth, hiring and investment.
The White House claims domestic steel production is surging, but many users of the metal are grappling with high costs and spending more trying to comply with the evolving tariff regime.
In April, the administration lowered tariffs to 25% on some imported derivative goods deemed to be “substantially made” of steel, aluminum or copper while maintaining a higher 50% rate on many other imports containing the metals.
Globally, aluminum buyers have been shaken by the closing of the Strait of Hormuz and the turmoil in the Persian Gulf, which accounts for nearly 10% of global supply.
Diesel fuel prices have also sharply risen since the US and Israel launched a war with Iran, while companies like Deere & Co., the maker of iconic green farm machinery, last month faulted soaring fuel and fertilizer costs for sluggish tractor sales.
Shares of Kubota Corp., the Japanese industrial machinery manufacturer, rose as much as 7.9% in Tokyo after the announcement.
Trump cited rising costs as a justification for the move.
“Among other things, the Secretary has informed me that recent circumstances have affected and are affecting domestic industries that use agricultural equipment, industrial equipment and machinery, and other related products,” the president’s proclamation reads.
Democrats have frequently cited rising costs to farmers as a result of Trump’s trade policies as an issue that could help flip key House and Senate seats in the Midwest in November’s midterm elections.
