Retroactive Application of Tariff Reduction on Automobiles and Parts from November 1
The Democratic Party of Korea introduced a special bill on November 26 to support the implementation of a $3,500 investment in the United States, in accordance with the Korea-US tariff negotiations. With the submission of this special bill to the National Assembly, the requirements have been met for the retroactive application of the reduced tariff rate on automobiles and parts (from 25% to 15%) as of November 1.
Heo Young, Senior Deputy Floor Leader for Policy, and Baek Seungah and Moon Geumjoo, Floor Spokespersons of the Democratic Party, visited the main building of the National Assembly on this day to submit the special bill for the management of strategic Korea-US investments (the Special Act on Investment in the United States). Heo explained, "The bill includes not only commercial rationality and investment limits as stated in the fact sheet, but also safeguards in case of impacts on the Korean foreign exchange market." The Special Act on Investment in the United States is a follow-up support bill to implement the Memorandum of Understanding (MOU) on strategic investment between the government of the Republic of Korea and the United States of America.
The bill systematizes the decision-making structure for strategic investments. When the Project Management Committee, to be established under the Ministry of Trade, Industry and Energy, reviews the business feasibility, the Operations Committee to be established within the Korea-US Strategic Investment Corporation will deliberate and decide on the investment intent.
In addition, to raise, manage, and operate funds for strategic investments, the Korea-US Strategic Investment Corporation will be established, along with the Korea-US Strategic Investment Fund. The corporation will be established with government capital and will operate for a limited period of up to 20 years. The fund will be sourced from the management profits of foreign exchange reserves entrusted by the government and the Bank of Korea, as well as from the issuance of government-guaranteed bonds overseas. Heo stated, "By introducing the special bill, the content regarding the retroactive application of the tariff reduction (for automobiles and parts) from November 1 is expected to be published in the Federal Register."
The People Power Party argues that ratification by the National Assembly is necessary. The chair of the National Assembly's Strategy and Finance Committee, which reviews the special bill, is Assemblywoman Lim Ija from the People Power Party. Heo said, "We are not considering the fast-track (expedited process) at this time," adding, "Since this is a strategic investment under the Korea-US alliance at the national level, we expect and request the active cooperation of the People Power Party."
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