WASHINGTON — The Biden administration is imposing tariffs on steel and aluminum shipped from Mexico that were made elsewhere — an attempt to stop China from avoiding import taxes by routing goods through one of the United States’ closest trading partners.
Lael Brainard, director of the White House National Economic Council, said the tariffs announced Wednesday will be levied as part of an agreement with Mexico through section 232 of the Trade Expansion Act, which applies to imports that could threaten U.S. national security.
There will be a 25% tariff on steel not melted or poured in Mexico and a 10% tariff on aluminum.
The new taxes on steel are meant to address the evasion of tariffs by China, the dominant producer of more than half of the world’s steel. The aluminum taxes would also hit production based in China, Belarus, Iran and Russia.
The move is also a clear political shot at Republican Donald Trump, President Joe Biden’s predecessor and his likely opponent in November’s election. Brainard noted that Trump could have taken similar actions but failed to do so.
“The president is taking action to close loopholes left by his predecessor that allowed China to circumvent trade rules,” she said.
The financial impact of the tariffs is likely somewhat modest, though, given the volumes of steel and aluminum being routed this way through Mexico.
Administration officials said the U.S. imported 3.8 million tons of steel last year from Mexico, with 13% of that having been poured or melted outside that country. Similarly, the U.S. imported 105,000 metric tons of aluminum from Mexico and only 6% was smelted or cast outside that country.
Still, the issue could be politically relevant. Sen. Sherrod Brown, D-Ohio, has called for stopping Mexican steel imports, saying that a “surge” from that country is a threat to U.S. steelworkers and a way to evade tariffs.
Brown is seeking reelection against Republican Bernie Moreno, a wealthy businessman from Cleveland. Ohio was once a political bellwether, but it has voted for Trump in the previous two presidential elections.
Implementation of the new tariffs begins Wednesday with the announcement.
The Biden administration recently announced plans to impose taxes on foreign-made steel and aluminum imports that are routed through Mexico. This move is part of the administration’s efforts to protect American industries and workers from unfair trade practices and to promote domestic manufacturing.
The decision to target steel and aluminum imports that pass through Mexico is significant, as Mexico has become a key transit point for goods entering the United States. By imposing taxes on these imports, the Biden administration hopes to discourage companies from using Mexico as a way to circumvent existing trade regulations and tariffs.
The new taxes are expected to have a significant impact on the steel and aluminum industries, which have long been at the center of trade disputes between the United States and other countries. By targeting imports that pass through Mexico, the administration aims to level the playing field for American producers and prevent them from being undercut by foreign competitors who may be taking advantage of loopholes in the current trade system.
Critics of the new taxes argue that they could lead to higher prices for consumers and hurt businesses that rely on imported steel and aluminum. However, supporters of the move believe that it is necessary to protect American jobs and industries from unfair competition.
In addition to imposing taxes on foreign-made steel and aluminum imports, the Biden administration has also signaled its intention to review existing trade agreements and policies to ensure that they are in line with its goals of promoting fair trade and supporting American workers.
Overall, the decision to target steel and aluminum imports that pass through Mexico is a bold move by the Biden administration to protect American industries and workers from unfair trade practices. It remains to be seen how this will impact the broader economy, but it is clear that the administration is committed to taking action to support domestic manufacturing and ensure a level playing field for American businesses.
