US and UK sign new trade deal

What is the US-UK trade deal?

Automobile imports: lower tariffs, set quotas
Annual quota: The US will allow up to 100,000 British-made cars, as classified in heading 8703 of the Harmonized Tariff Schedule of the United States (HTSUS) and as further specified in note 33(b) to subchapter III of chapter 99 of the HTSUS for automobiles that are products of the United Kingdom, to be imported each year under a special tariff-rate quota. The tariff-rate quota shall be adjusted for calendar year 2025 to reflect the General Terms’ operative date of May 8, 2025.
Tariff changes: Normally, cars from the UK would face a 25% import tax. Under the new deal, the first 100,000 cars will face a combined 10% tariff (7.5% special tariff plus the usual 2.5% most-favored-nation (MFN) tariff). Any cars imported beyond that number will still be taxed at the full 25% rate under Proclamation 10908.
Automotive parts: Certain parts, as specified in note 33(g) to subchapter III of chapter 99 of the HTSUS, made in the UK for use in British cars will also be taxed at 10% (inclusive of the MFR tariffs) instead of 25%.
Aerospace products: removal of various tariffs
Tariff removal: UK-made aerospace products (like airplane parts) that fall under the World Trade Organization Agreement on Trade in Civil Aircraft, will no longer be subject to tariffs imposed under the following actions:
Executive Order 14257 (reciprocal tariffs), as amended;
Proclamation 9704 (aluminum tariffs), as amended; and
Proclamation 9705 (steel tariffs), as amended.
The Secretary of Commerce has been charged, in consultation with ITC and CBP, with publishing a notice in the Federal Register modifying the HTSUS consistent with this section, as necessary.
Steel and aluminum: future quotas and lower barriers
Tariff-rate quotas to come: The US Secretary of Commerce, in consultation with the USTR, will set limits (tariff-rate quotas) on how much steel and aluminum, and their derivatives, from the UK can enter the country at lower tariff rates. The exact numbers and rates will be determined later, depending on how well the UK meets US requirements with respect to national security, as well as actions taken by the UK to meet the terms of the deal.
Imports exceeding quotas: Any UK steel or aluminum, and their derivatives imported above those quotas will remain subject to the duties set forth in Proclamations 9704 and 9705, as amended.
Pharmaceuticals: preferential treatment on the horizon
The two countries have agreed to work toward giving preferential treatment to UK pharmaceuticals and ingredients, contingent on the findings of an investigation regarding pharmaceuticals and pharmaceutical ingredients under section 232, and provided that the United Kingdom complies with certain supply chain security standards.
Ongoing cooperation: national security and future sectors
The deal commits both countries to keep working together on sectors that may be subject to future section 232 investigations. To that end, the US and the UK are further committed to strengthening aerospace and aircraft manufacturing supply chains by establishing tariff-free bilateral trade in certain aerospace products.

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