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PRIVILEGED AND CONFIDENTIAL: ATTORNEY-CLIENT COMMUNICATIONS: CTDA MEMBER UPDATE ON TRADE ISSUES RELEVANT TO THE CERAMIC TILE INDUSTRY
US/EU agreement on tariffs and its impact on ceramic tile
imports from the European Union
BRIEF BACKGROUND: The genesis of the US/EU trade dispute goes back to the post World War II Marshall Plan, in which the US agreed to help rebuild the devastated European countries’ economies and infrastructure in part by lowering US tariffs to about 60 percent of the level of European tariffs on US products. After 80 years, this has resulted in a massive merchandise trade deficit with what is now the European Union; as a consequence, in 2024 U.S. goods exports to the European Union in 2024 were $370.2 billion while U.S goods imports from the European Union totaled $605.8 billion, for a bilateral trade of $ 2 in US exports to the EU for over $ 3 in US imports from the EU.
In early April, the Trump Administration imposed a 10 percent baseline tariff on products from the 27 member countries of the EU with higher rates for US imports of steel, aluminum, certain derivative products containing such metals, and autos and automotive parts. This was in addition to the current Most Favored Nation (“MFN”) tariff rates granted to virtually all US trading partners. This baseline approach was intended to be temporary, to be supplanted by a permanent new set of tariffs on EU products to be imposed by August 1st. The Administration threatened to impose 30 percent tariffs on imports from the EU if agreement could not be reached.
The TENTATIVE agreement between the US and EU, as reported in multiple press accounts, provides for the following:
- There will be a baseline US tariff of 15 percent on the value of virtually all US imports from the 27 member nations of the EU. As is being reported, this baseline 15 percent will not be “stacked” onto the current MFN rates but will replace them; if this works out in practice, the tariffs on ceramic tile classifiable in USHTS 6907, most of which range from 8.5 to 10 percent plus the 10 percent baseline rate, would be set at a flat 15 percent, or an actual reduction in the current US tariff rates for most tile from the EU;
- There is no special carve out for Spain. In June, President Trump reacted to Spain’s public refusal to increase NATO defense spending by threatening Spain with double the tariffs imposed on the same products imported from other EU countries. As of now, Spanish goods are not singled out for such retaliation;
- The current 50 percent US tariffs on steel, aluminum and specified derivative products containing those metals will remain in effect. EU President von der Leyen referenced ongoing negotiations with the US to replace this metals tariff with voluntary negotiated quotas of the shipments of these metals and metal products to the US;
- Special rules will apply to vehicles, automotive parts, liquor and wine and certain other products. There is no indication that ceramic tile from the EU will fall within these identified product classes granted such special status;
- As of now, these new tariffs on EU ceramic tile go into effect at 12:01 on Friday, August 1st.
CTDA anticipates that as previously, US Customs and Border Protection will issue directives to the ports and import community implementing the new tariffs on products imported into the US. CTDA will provide our members with such official updated information from CBP and the White House as soon as it is made available.
If you have any questions, please contact CTDA Legal Counsel Robin Grover at (202) 302-1653. We will promptly alert you to any further developments regarding this and other trade issues.
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