The Business Roundtable (BRT) urged the reinstatement of preferential treatment in the USMCA as part of consultations for the review of this trade agreement.

In a letter to the USTR, the BRT pointed out that tariffs applied to goods that comply with the USMCA are counterproductive to the economic and national security interests of the United States, and therefore called for maintaining the tariff-free structure as a pillar of trade in North America.

Preferential treatment in the USMCA

The BRT brings together more than 200 CEOs from leading U.S. companies. Together, they represent all economic sectors. In addition, they lead U.S.-based companies that account for one in four jobs and nearly a quarter of GDP.

The organization stressed that all goods compliant with the USMCA should be exempt from tariffs not explicitly authorized, including taxes derived from Section 232 of the Trade Expansion Act of 1962 and the International Emergency Economic Powers Act. 

It also highlighted the importance of maintaining the exemption from tariffs for the processing of goods.

Since the USMCA came into force, intraregional trade in goods and services has grown by 37%, driven mainly by the industrial sectors.

For the BRT, restoring full access to USMCA preferential trade would increase trade flows in North America and strengthen the reliability of supply chains with trusted partners.

Iron and steel

Finally, the BRT argued that preferential treatment would strengthen cooperation with countries that have agreed to higher trade standards. It highlighted the role of USMCA committees in reviewing and improving rules, ensuring that the Agreement remains aligned with U.S. domestic interests.

Canada and Mexico reinforce the USMCA with strict rules of origin and trade alignment with the United States. In addition, both countries are adjusting measures against non-market practices, including products subject to Section 232, such as iron and steel.

Automotive industry

In mid-January, Mexico asked the United States to reduce the tariff applied to imports of cars that do not comply with USMCA rules of origin from 27.5% to 15%. This was reported by Economy Secretary Marcelo Ebrard.

Currently, the United States applies an MFN tariff of 2.5% on cars from WTO countries, plus an additional 25% levy. However, discounts are granted based on the U.S. content in vehicles from Mexico and Canada.

Ebrard explained that the current discounts are equivalent to an effective tariff of 13% for passenger vehicles and trucks originating in Mexico.

Likewise, that 25% tariff was reduced to 15% through agreements between the United States and the European Union, Japan, and South Korea. In the case of the United Kingdom, it was set at 7.5% for a quota of 100,000 units.