US and China Agree to Temporary 90-Day Tariff Reduction, Slash Rates by Over 100%
On 12 May 2025, the United States and China agreed to temporarily reduce tariffs, easing bilateral trade tensions during a 90-day period. In a Joint Statement, both countries outlined the terms of the agreement following negotiations held in Geneva, Switzerland.
Under the agreement, beginning 14 May 2025, both countries will reduce their respective tariff rates on each other's goods by 115% for 90 days. As a result, the overall tariff rate of 145% will fall from 145% to 30%, while China's rate on US goods will decrease from 125% to 10%.
More specifically, the United States will suspend 24% of additional tariffs imposed on 2 April 2025, and eliminate tariffs imposed on 8 and 9 April 2025. China will similarly suspend 24% of tariffs introduced under Announcement No. 4 (4 April 2025), remove additional measures from Announcements No. 5 and No. 6, remove retaliatory tariffs and suspend non-tariff countermeasures adopted since 2 April 2025.
Despite the reductions, both countries will retain a 10% baseline tariff during the 90-day period, with the United States maintaining pre-April 2025 tariffs including section 301 and 232 tariffs, and duties imposed in response to the fentanyl national emergency.
In a Fact Sheet, the White House described the deal as a "historic trade win" for the United States. The development also marks the first joint statement of the United States and China on trade in many years.
As of date of publication, China has not issued any official document confirming the joint statement.
Note: The trade deal comes after a series of aggressive US tariff actions introduced under President Trump's trade policy agenda, aimed at protecting domestic industries from what he characterized as unfair international competition.
Visit our Tax Research Platform for prior coverage on US tariffs, see:
US President Trump Issues Executive Order to Prevent Tariff Stacking, Proclaims Modified Automobile Tariff Offsets to Incentivize Domestic Production (30 April 2025); US Customs and Border Protection Applies New Duties on Chinese Imports (25 April 2025); US Escalates Trade Measures with 245% Tariff on Chinese Imports Amidst New National Security Push on Critical Minerals (16 April 2025); United States Flips on Electronics Tariff Exemptions: Customs Border Protection Says Excluded, President Trump Says Not So Fast (14 April 2025); China Raises Counter-Tariffs to 125% Following US Tariff Hike (11 April 2025); United States Clarifies China Tariffs Are 145%, Not 125% (11 April 2025); United States Pauses Tariffs for Most Countries for 90 Days, Hikes China Tariffs to 125% (10 April 2025); United States Slaps Additional 50% Tariff on Chinese Imports, Bringing Total Tariff Rate to 104% (9 April 2025); China Retaliates Against US Tariffs with New Countermeasures (4 April 2025); Trump Administration Rolls Out Sweeping 10% General Tariff on All Imports, Reciprocal Elevated Duties Targeting EU, 53 Other Countries (3 April 2025); and President Trump Doubles Down on Tariffs as China Fails to Act on Opioid Crisis (4 March 2025).