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U.S. Auto Tariffs Still Option If Protectionism Stays, Ross Says

Friday 24th January 2020

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The U.S. could still consider imposing tariffs on auto imports from the European Union and elsewhere if countries continue to undertake protectionist measures, Commerce Secretary Wilbur Ross said.

“We have a perfect justification to put tariffs on if we wish to; the president decided it was better to negotiate,” Ross said in an interview at the World Economic Forum in Davos Thursday. “We’ve had constructive negotiations with the German car manufacturers, with the Koreans and with the Japanese. So far we haven’t felt the need to do it. But if people do silly things, if they do protectionist and discriminatory things, like pillar one of the digital-services tax, we’re obviously going to respond.”

French President Emmanuel Macron and U.S. counterpart Donald Trump agreed this week to a truce in their dispute over digital taxes that will mean neither country will impose punitive tariffs in 2020. While the OECD is still working on its proposal for taxing tech companies around the world, France pushed ahead with its own levy last year that hit U.S. internet giants like Google, Apple Inc. and Inc.

The move is one of many in rising trade tensions between the U.S. and European countries. In May, Trump gave himself a deadline of mid-November to decide whether to impose levies on cars and auto parts. The EU threatened to retaliate with tariffs on $39 billion of American goods if Trump carried out his plan. The Commerce Department undertook a study on whether to levy the duties under Section 232 of the Trade Expansion Act, which allows for tariffs without a vote by Congress if imports are deemed a national-security threat.

People “simply don’t understand section 232 -- what was needed in November was for the president to decide on a path forward. He did -- he decided the path forward was to negotiate as long as that was bearing fruit. The November deadline was “an imaginary deadline,” Ross said. “The deadline was that he would take a decision - he took a decision. Period.”


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