The Trump administration has agreed to fix a major error in its trade agreement with Japan by eliminating the stacking of multiple tariff rates.
Japan’s chief trade negotiator, Ryosei Akazawa, told reporters in Washington D.C. Thursday that the “extremely regrettable” mistake where Trump’s 15 percent tax on Japanese imports was added on top of existing tariffs has now been corrected, via The New York Times.
Trump had already struck a similar arrangement with the European Union, ensuring all EU imports faced a flat 15 percent rate rather than stacking all existing levies. But that same provision never made it into the president’s July 31 executive order announcing his latest wave of “reciprocal” tariffs, despite it being a key part of the trade negotiations between Japan and the U.S.
The costly mistake, a symbol of the chaos and flip-flopping throughout Trump’s global trade war, meant products from Japan that already carried a tariff such as beef (26.4 percent) were mistakenly hit with an additional 15 percent, Forbes reported. Other products such as fabrics (7.5 percent) also saw their levies increase too much to 22.5 percent, rather than agreed upon 15 percent.
Akazawa confirmed the U.S. will refund Japan for the excess duties collected since the tariffs that took effect just after midnight Thursday, when dozens of other countries also faced new trade rates.
Trump announced the revised trade arrangement on Truth Social in July, hailing it as “perhaps the largest Deal ever made,” which would see Japan “open their Country to Trade including Cars and Trucks, Rice and certain other Agricultural Products.”
Trump also claimed Japan would inject $550 billion into the U.S. economy in exchange for the 15 percent tariff rate, and boasted that the U.S. would “receive 90 percent of the Profits” from this investment.
But Akazawa painted a different picture, and said the country only expects 1-2 percent of the $550 billion figure to be a direct investment, with a bulk of the funds coming via loans.
Trump recently told CNBC that the money from Japan is like a “signing bonus” a baseball player would get, and that the U.S. is free to invest it however they want.
Speaking to reports on Thursday, Akazawa downplayed the comments from the president as “just typical Trump talk,” via The Japan Times.
The White House did not respond to a request for comment from The Daily Beast.
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