U.S. Tariff Relief for Products of Japan Coming Soon

On September 4, 2025, the White House released an Executive Order, Implementing the United States-Japan Agreement. The Agreement outlines a tariff framework that contains several layers of duty reductions for specific products of Japanese origin. One of the most significant changes is to the reciprocal tariff rate on products of Japan, which will be identical to the one placed on the EU last month. Also, certain aerospace goods, automobiles, and auto parts will soon receive other tariff relief.

Guidance from U.S. Customs and Border Protection (CBP) will be released soon to confirm changes to the Harmonized Tariff Schedule of the United States (HTSUS) for the modifications mentioned in the Executive Order (EO). Once programming is in place, Importers may begin filing entries with the new duty rates and requesting refunds for overpayment of reciprocal tariffs, retroactive to August 7.

Details

Reciprocal Tariffs

The EO modifies the reciprocal tariffs imposed under Executive Order 14257 on Japanese products from a flat 15% to the following rates determined by the product’s Column 1 Duty Rate in the HTSUS:

• Products with a Column 1 Duty Rate that is less than 15%: The sum of its Column 1 Duty Rate and the additional ad valorem rate of duty shall be 15%.
• Products of Japan with a Column 1 Duty Rate that is at least 15%: The additional rate of duty shall be zero percent.
• Products that have a specific or compound duty rates:
  • Shall be treated the same as products of the EU.
  • The ad valorem equivalent rate of duty of such good shall be determined by dividing the amount of duty payable under column 1 – General by the customs value of the good.
  • Example, if a good were subject to a specific duty of 50 cents per kilogram, and one kilogram of the good were entered with a customs value of $10, then the ad valorem equivalent rate of duty would be obtained by dividing 50 cents by $10, yielding 5 percent.”
• All other terms of the Reciprocal Executive Order 14257, as amended, shall continue to apply to products of Japan.
• The tariffs shall apply retroactively to products of Japan entered for consumption or withdrawn from warehouse for consumption on or after 12:01 a.m. Eastern Daylight Time on August 7, 2025. Any refunds shall be processed pursuant to applicable laws and CBP’s standard procedures for such refunds.
• The Secretary may issue rules, regulations, guidance, and procedures to carry out the provisions of this section, including rules for determining what are “products of Japan” for purposes of this section.

Aerospace Goods

Products of Japan that fall under the World Trade Organization (WTO) Agreement on Trade in Civil Aircraft, except for unmanned aircraft, will no longer be subject to the tariffs imposed by the following Presidential actions, effective as of the date of publication of the Federal Register notice:

• Executive Order 14257 – Reciprocal Tariffs
• Proclamation 9704 – Section 232 Aluminum
• Proclamation 9705 – Section 232 Steel
• Proclamation 10962 – Section 232 Copper

Within 7 days of the date of publication in the Federal Register, the Secretary shall publish a notice in the Federal Register modifying the HTSUS.

The Secretary may issue rules, regulations, guidance, and procedures to carry out the provisions of this section, including rules for determining what are “products of Japan” for purposes of this section.

Automobiles and Automobile Parts

Effective the date of publication of the Federal Register notice, the duties on automobiles and automobile parts subject to Section 232 Auto/Auto Parts tariffs shall be determined by the product’s Column 1 Duty Rate:

• Products with a Column 1 Duty Rate that is less than 15%: The sum of its Column 1 Duty Rate and the Section 232 Auto/Auto Part rate of duty equal 15%.
• Products with a Column 1 Duty Rate that is at least 15%: The additional Section 232 Auto/Auto part rate imposed shall be zero percent.

Within 7 days of the Federal Register publication date, the Secretary shall publish a notice in the Federal Register modifying the HTSUS.

The Secretary may issue rules, regulations, guidance, and procedures to carry out the provisions of this section, including rules for determining whether automobiles and automobile parts are “products of Japan” for purposes of this section.

Products Not Subject to Reciprocal Tariffs

To implement the terms of the Agreement, the Secretary is authorized to modify the reciprocal tariff rate imposed under Executive Order 14257, as amended, to zero percent for products of Japan that are (effective date and details TBA):

• Natural resources unavailable (or unavailable at sufficient scale to satisfy domestic demand) in the United States,
• Generic pharmaceuticals,
• Generic pharmaceutical ingredients, and
• Generic pharmaceutical chemical precursors

Additional Information

Check back for more details in the upcoming days. Federal Register notice(s) and guidance from U.S. Customs and Border Protection (CBP) will be released soon.

Have Questions?

Contact your local NNR Representative