Thailand moves quickly to avoid 36% tariffs with the US
Thailand is taking rapid steps to sign a trade agreement with the United States before a July 9 deadline. The move is aimed at avoiding a 36% flat import tariff that could be imposed if there is no suitable deal.
The final negotiations will begin next week, with Finance Secretary Pichai Chunhavajira flying to Washington to address key issues. The effort reflects a strategy to maintain a competitive edge in the global marketplace, especially in the digital economy.
Tax Rate Adjustments and Negotiation Strategies
Pichai has confirmed that the 18% rate often reported in the press is an economic model used by the Bank of Thailand as a test, not a formal agreement. This clears up speculation about Thailand’s ability to reach a minimum tax rate in upcoming negotiations.
Mr. Wuttikrai Leeviraphan, Senior Secretary of Commerce, confirmed that Thailand made an official proposal on June 20, to potentially reduce tariffs to 10%, the minimum level under the reciprocal trade agreement in April.
The United States is flexible but still maintains its negotiating power.
President Donald Trump initially announced tariffs on all imports from trading partners on April 2. Although the base tariff was reduced to 10%, other tariffs remained in place for 90 days to negotiate.
The deadline is July 8, after which countries that fail to reach a deal could face higher tariffs. White House press secretary Karoline Leavitt has insisted that these deadlines are flexible and could be adjusted at the president’s discretion.
US steps up strategic talks with top partners
US Commerce Secretary Howard Lutnick has stressed that the administration is looking to sign major trade agreements in the coming weeks, with Thailand emerging as one of the top priority partners.
The talks come after the United States reached a trade deal with China in Geneva that would see China supply rare earth minerals needed for the U.S. defense and renewable energy industries, an agreement that could serve as a model for future bilateral agreements.
European Union faces 50% tariffs from the US
The EU is also under intense pressure to reach a new trade deal during this time, with President Donald Trump threatening to impose a 50% tariff on EU goods starting July 9.
European Commission President Ursula von der Leyen said the EU is ready to negotiate, but is also prepared to prepare contingency strategies. Currently, most EU products face a 10% tariff, with additional tariffs already imposed on some sectors such as cars, steel and aluminum.
Thailand's negotiating policy clearly reflects the US administration's shift toward using diplomatic levers such as direct negotiations, tariff threats, and pushing for quick bilateral deals to increase negotiating power in the international market.
Source: https://tintucbitcoin.com/thailand-reduces-tax-for-han-my-den-near/
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