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Lutnick confirms retroactive application of lowered 15% tariff on Korean autos

Published: 02 Dec. 2025, 09:51 Updated: 02 Dec. 2025, 14:23

U.S. Commerce Secretary Howard Lutnick speaks to the media, on the day he attends a working lunch with EU ministers responsible for trade, in Brussels, Belgium, on Nov. 24. [REUTERS/YONHAP]

U.S. Commerce Secretary Howard Lutnick said on Monday that Washington has lowered tariffs on Korean imports, including automobiles, to 15 percent from 25 percent, effective Nov. 1, under a bilateral trade and investment agreement.

The tariff cut was included in a trade deal finalized on Oct. 29 during a summit in Gyeongju, North Gyeongsang, between President Lee Jae Myung and U.S. President Donald Trump.

According to a memorandum of understanding signed on Nov. 14, which sealed Seoul's pledge to invest $350 billion in the United States, both sides agreed that the reduced tariff rate would be applied retroactively from Nov. 1 — the day a special investment facilitation bill was introduced in Korea’s National Assembly.

The bill, submitted by the Democratic Party, was formally introduced on Wednesday.

“The Republic of Korea has officially moved to implement their strategic-investment legislation in parliament,” Lutnick said in a statement posted on X. “In response, the U.S. will lower certain tariffs under the deal — including auto tariffs to 15%, effective November 1. We are also removing tariffs on airplane parts and will ‘un-stack’ Korea’s reciprocal rate to match Japan and the EU.”

The agreement also limits any future U.S. tariffs on semiconductors and pharmaceuticals to 15 percent, aligning Korea’s treatment with that of competitors such as Japan and Taiwan.

Korean Industry Minister Kim Jung-kwan earlier sent a letter to Lutnick notifying him of the bill’s submission and urging swift publication of the retroactive tariff cut in the U.S. Federal Register.

"Korea's commitment to American investment strengthens our economic partnership and domestic jobs and industry," Lutnick said in the statement. "We are also grateful for the deep trust between our two nations. I look forward to continuing to work closely with Seoul to build an even stronger and more prosperous future for both nations."

BY KIM JU-YEON, YONHAP [[email protected]]