US documents show it knows its 20% tariff claims for New Zealand are false

Friday, 4 April 2025

The White House’s board of tariff deceptions. (AP Photo/Mark Schiefelbein)

Documents from the US International Trade Administration reveal US President Donald Trump’s big lie about the tariffs New Zealand levies on imports from the US.

On “Liberation Day” on Thursday, Trump held up charts showing what he claimed were the levels of “unfair” tariffs charged by other countries on US goods entering their countries.

It contained the false claim that in New Zealand, these tariffs amounted to 20%, which the White House is using to justify slapping an additional 10% tariff on the hefty tariffs it already charges on New Zealand goods entering the US.

That could deliver a hit to New Zealand exporters of around $900 million, according to Westpac. It would take some New Zealand dairy import tariffs as high as 29.6% when New Zealand’s tariffs for US dairy products is effectively zero.

But the documents published by US government’s own International Trade Administration (ITA) reveal a different story.

“Most tariffs range from zero to 10%,” the ITA’s website says. “These duty rates apply mostly to clothing, footwear, and carpeting. Most passenger vehicles and almost all computer software and hardware enter tariff-free.”

After weeks of anticipation and speculation, President Donald Trump followed through on his reciprocal tariff threats by declaring on Wednesday a 10% baseline tax on imports.

And, it says: “Alcoholic beverages (including beer, wine, and spirits), tobacco products, and some petroleum products are subject to excise duties that also apply to similar items that are produced domestically.”

The ITA data was published under the administration of the previous US President Joe Biden.

It appears that in order to pretend that US exporters face tariffs of 20% getting their goods into New Zealand, the US is counting New Zealand’s GST tax to be a tariff, despite the US having its own sales taxes.

But even adding GST of 15% to the 1.9% average tariff load on US imports into New Zealand doesn’t get Trump to his 20% New Zealand tariff claim.

President Donald Trump departs after signing an executive order at an event in the Rose Garden to announce new tariffs.

However, the US President seemed to suggest that the US’ calculations somehow took into account the “non-tariff barriers” its exporters faced to getting into other markets.

Non-tariff barriers exist in all countries.

They can range from protection of nature, like New Zealand’s biosecurity rules, to barriers at least partially designed to stymie foreign companies’ activities, like China’s restrictions on US technology and social media companies.

Doing business in the US is notoriously hard and bureaucratic. As New Zealand Trade and Enterprise (NZTE) notes: “Setting up operations in the US is very complex.”

Different states have different laws, taxes and new bureaucracies to deal with.

By contrast, ITA heaps praise on the ease of doing business in, and exporting to New Zealand.

New Zealand imports a lot of US agri-equipment.

ITA documents show what the US sees as non-tariff barriers to exporting goods and services to New Zealand, however, it is more often complementary of easy access to New Zealand for US exporters, rather than making claims of unfair treatment, as Trump appears to claim.

“New Zealand industries across the board are receptive to new and innovative technologies that reduce costs and increase productivity,” ITA says.

“Agribusiness, New Zealand’s leading business sector, is an example where mechanisation and digital technologies are linked to farm production.”

And it says: “New Zealand’s market size is ideal for New-To-Export companies and for testing New-To-Market products.”

ITA says: “New Zealand has effectively removed all barriers to foreign firms bidding and winning procurement contracts.”

Another non-existent non-tariff barrier is intentional inefficiency.

“Documentation requirements for the import and export of goods into New Zealand are straightforward,” the ITA says.

The US is a leader in genetic modification of crops.

So what does the ITA include in its list of non-tariff barriers?

GM food labelling

“Under the standard, the label listing ingredients for food products, with certain exceptions, must include the words ‘genetically modified’ if genetic material or protein from genetic modification is present,” the ITA says.

The US is the home of “bioengineered” food products, but New Zealand labelling requirements are not much of an imposition on the US, as its own laws require food producers to reveal on labels whether there is GM in their products.

Republican presidential candidate former President Donald Trump was himself a victim of the Second Amendment when he was shot with a legal AR-15-style rifle in July last year. (AP Photo/Evan Vucci, File)

Guns

The ITA says New Zealand maintains controls on the importation of a variety of goods based on criteria such as “community protection”.

It refers US exporters to the New Zealand Customs page that lists them.

These include pistols and semi-automatic rifles, and some other weapons that the 1791 second amendment to the US Constitution is interpreted as giving its citizens a right to own.

Lack of a free trade agreement with the US

“By 2030, New Zealand aims to have FTA arrangements to cover 90% of NZ goods exports. Free Trade Agreements currently in force,” the ITA says.

But, it says: “New Zealand does not have a Free Trade Agreement (FTA) with the United States.”

Pharmac is far from perfect, but it helps New Zealand manage its healthcare bill.

This however, is the fault of the US. New Zealand spent years trying to get one, says economist Brad Olsen.

Not Pharmac

Back in 2018 then Prime Minister Jacinda Ardern pledged to protect Pharmac in future trade agreements after Trump, the US President at the time, announced plans to make countries like New Zealand pay more for drugs, accusing them of “free-loading” and not paying the same prices that medicines sold for in the US.

However, ITA says New Zealand is “very receptive to US technologies and is constantly seeking new solutions that can add value to a healthcare system under constant pressure to minimise costs while delivering rising standards of excellence”.

“The United States is New Zealand’s largest source of healthcare products,” ITA says.

Graeme Jarvis, chief executive of Medicines New Zealand, a pharmaceuticals company lobbying association, says the sticking point for the US in trade negotiations was not the existence of Pharmac, but transparency, timely processes, and the lack of a review process.

Safety and professional standards

New Zealand recognises international product safety standards, but it is incumbent on importers to check that goods meet New Zealand standards.

Happily, the ITA reports, these are aligned to developed world standards in most cases, and while there is no single database of all standards, there is the World Trade Organisation service that helps exporters and importers check.

ITA says: “Registration is required by law for professional services such as accounting, consulting, human resource, and finance.”