A recent White House fact sheet has sparked confusion about the extent of US tariffs on Chinese goods, with some media reports claiming a 245 percent tariff rate. However, a closer look shows that this figure refers to the cumulative effect of multiple tariffs on specific products, such as syringes, rather than a new, blanket 245 percent tariff imposed by the Trump administration.
The fact sheet issued on April 15 have prompted several misleading media reports on April 16, claiming that the US has imposed new tariffs on Chinese goods in a move that could further derail the trade tensions between the world’s two biggest economies.
The fact sheet, under a sub-section Strengthening American Industry, said “China now faces up to a 245 percent tariff on imports to the United States as a result of its retaliatory actions.”
But, does it mean that the Trump administration has announced a new tariff on China? The answer is a simple no. The statement means rates on certain products can go up to a total of 245 percent.
So, where did this 245 percent figure came from?
In the past few weeks, the trade war between the two countries has seen a number of retaliations on each other’s goods, resulting in ever-changing trade rules. In some cases, tariffs announced have made the taxes costlier than the product itself.
However, last week, Trump had announced a 125 percent tariff on Chinese goods, which was over and above a 20 percent rate imposed earlier. This takes the total to a rate of 145 percent. However, the list of tariffs does not end there.
There are four major types of tariffs imposed on Chinese goods, according to The New York Times. They are: base tariffs (average of 3.4 percent), pre-2025 protectionist tariffs (ranging from 7.5 percent to 100 percent), tariffs targeting specific sectors such as steel, aluminium and auto (25 percent rate) and ‘fentanyl’ and ‘reciprocal’ duties. Some of these rates were announced to discourage Chinese imports such as solar panels and EV batteries that are sold at much cheaper rates than their American counterparts.
The application of tariff rates is more complicated than it seems. The effective rate depends on several factors such as the source of import, the materials used and if there are any exemption or special rates applicable, a report by NYT said.
Trump had also announced exemption for phones and some other electronic items. However, the president on Truth Social said “no one is exempted”, adding to the already confusing landscape.
Do any of the Chinese imports face 245 percent tariff?
Yes, with the addition of all the four major types of rates, some of the products such as syringes face a 245 percent tariff. It combines a 100 percent pre-2025 rate, 20 percent of fentanyl levy, 125 percent reciprocal tariff, resulting in a total of 245 percent duty.
Similarly, lithium-ion batteries face a total rate of 173 percent, 170 percent on Squids, 169 percent on wool sweaters, 148 percent on electric cars and the list goes on.
Elon Musk's AI chatbot Grok also delved into the question, answering a user on X if the news reports are true. To reiterate again, the 245 percent tariff is a culmination of all the new and old rates, and not a new rate altogether. The White House statement just reiterated the fact that the rates can go up to 245 percent.
The tariff saga has created a maze to be deciphered not just by policymakers and corporations, but by media houses as well. And it does not look to get any easier anytime soon.
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