Japan wins cut for car tariffs

The US has agreed a “massive” trade deal with Japan that includes cutting the tariffs on vehicles sold to America to 15 per cent, as opposed to the 25 per cent levy threatened by President Donald Trump.

Japan’s Prime Minister Shigeru Ishiba welcomed the announcement, saying it was “the lowest figure to date among countries with trade surpluses with the US”.

“We are the first [country] in the world to reduce tariffs on automobiles and auto parts, with no limits on volume,” he adds.

Ishiba notes the deal means US tariffs on vehicles and parts will be cut from 25 per cent to 15 per cent, reports the BBC.

However, the tax is above the 10 per cent Trump levied on Japan and other countries when Trump suspended higher so-called reciprocal tariffs between April and July.

In a letter sent to Japan this month, the US president threatened a 25 per cent tariff on the country’s exports to America unless a new trade deal was struck before August 1.

The new agreement also means Japan will invest US$550 billion (about NZ$900b) in the US and open its economy to American goods such as cars, trucks, rice and other agricultural products.

“We just completed a massive deal with Japan, perhaps the largest deal ever made,” says Trump on his Truth Social platform.