China says US committed to 20% tariff cap in trade talks

Investing.com -- China's Commerce Ministry said Monday that the United States has committed to capping replacement tariffs on Chinese goods at 20%, marking the first public disclosure of such a limit following recent bilateral trade discussions.

The ministry stated that Washington made the commitment during trade talks between the two countries. With the current replacement tariff standing at 12.5%, China indicated that the US has 7.5 percentage points of room for additional increases before reaching the stated ceiling.

The new tariffs were implemented as President Donald Trump rebuilds trade barriers after the Supreme Court struck down his initial levies. The duties align with tariff levels the administration proposed last month on 60 trading partners, citing inadequate efforts to address forced labor. The new rates replaced global duties of 10% that expired on July 24.

The US has separately initiated a probe into China over alleged overcapacity issues in its manufacturing sector. The investigation could result in further levy increases.

China's retaliatory measures against the first round of US fentanyl and reciprocal tariffs remain in effect, according to the ministry statement. Beijing criticized Washington for imposing tariffs based on forced labor concerns, saying it had established a comprehensive legal framework to prevent and combat the practice.

"We will continue to closely monitor and fully assess subsequent US measures, and reserve the right to take all necessary measures," the ministry said.

The ministry urged the US to correct its practices, remove unilateral tariffs and continue resolving differences through dialog. China said the US indicated the levies would replace duties imposed under the International Emergency Economic Powers Act and Section 122 import surcharges.

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