Quantify your exposure in 20 minutes
Our trade strategists run your last 90 days of entries through Captain to surface refund eligibility, Section 232 traps and PNTR risk.
U.S.-South Korea Trade Snapshot in 2026
The U.S.-Korea Free Trade Agreement (KORUS), in effect since 2012, is the largest bilateral U.S. FTA by trade volume after USMCA. KORUS eliminated duties on most goods traded between the two countries — but Section 232 and IEEPA have imposed new tariff layers on specific sectors that KORUS alone does not protect.
South Korea as a U.S. Trading Partner
The U.S. imported approximately $130 billion in goods from South Korea in 2024, making it the sixth-largest import source. Korean export strengths align precisely with the sectors facing the most tariff scrutiny: passenger vehicles (Hyundai, Kia), semiconductors (Samsung, SK Hynix), consumer electronics (Samsung, LG), and steel (POSCO). The KORUS FTA provides a strong tariff foundation but does not override Section 232 authority. Our current U.S. tariff rates by country page covers Korea’s comparative tariff profile.
Key Import Categories from South Korea
- Passenger vehicles (HTS Chapter 87.03): Hyundai, Kia Korea-assembled models.
- Semiconductors and memory chips (HTS Chapter 85): Samsung DRAM, SK Hynix NAND.
- Consumer electronics (HTS Chapter 85): Samsung OLED TVs, LG appliances, LG OLED panels.
- Steel and flat-rolled products (HTS Chapter 72–73): POSCO hot-rolled coil, galvanized sheet.
- Industrial machinery and equipment (HTS Chapter 84): process equipment, precision components.
- Ships and marine equipment (HTS Chapter 89): LNG tankers, containerships.
Current U.S. Tariff Stack on South Korea Imports
South Korea’s tariff profile is uniquely bifurcated: KORUS-qualifying goods at 0%, non-KORUS goods at IEEPA rates, and sector-specific Section 232 tariffs that apply regardless of KORUS status.
Statutory Authorities in Play
KORUS FTA (Korea-U.S. Free Trade Agreement)
Provides 0% duty on most goods meeting KORUS rules of origin. See USTR KORUS for agreement text and tariff schedules. Notable exception: passenger vehicles (HTS 8703) carry a 2.5% KORUS rate (not 0%) — reduced from the 2.5% MFN rate through minimal modification. KORUS was renegotiated in 2018 to extend the auto tariff phase-down.
IEEPA Liberation Day (Executive Order 14257, April 2025)
Announced a 25% reciprocal rate on Korean goods. Under the 90-day pause, reduced to 10% baseline. KORUS-qualifying goods may be carved out from IEEPA — but importers must verify current IEEPA/KORUS interaction status with CBP. The Federal Register tracks executive order details.
Section 232 steel (Trade Expansion Act §232)
- Within-quota: 0% (KORUS steel exemption applies).
- Over-quota: 25%. Korea’s TRQ is set at approximately 70% of historical average annual imports. Quarterly monitoring of CBP TRQ fill rates is essential for POSCO and other Korean steel importers.
Section 232 aluminum
- Within-quota: 0% (TRQ applies).
- Over-quota: 10%.
Section 232 autos
25% on Korean-assembled passenger vehicles and auto parts not qualifying for KORUS exemption. Note: KORUS does not exempt autos from Section 232 — Korea-assembled vehicles face Section 232 regardless of KORUS ROO compliance. The 2.5% KORUS auto rate + 25% Section 232 = 27.5% effective rate on Korea-assembled vehicles before IEEPA.
How the Rates Layer on a Single Entry
A Korea-assembled Hyundai Tucson (HTS 8703.40) during the IEEPA pause:
- KORUS auto rate: 2.5%.
- Section 232 auto: +25%.
- IEEPA baseline (pause): +10%.
- Effective rate (pause): 37.5%.
The same Tucson assembled in Hyundai’s Alabama plant: U.S. origin = 0%. Korean-brand vehicles assembled in the U.S. avoid the full tariff stack. Hyundai’s Montgomery, Alabama and Metaplant Georgia facilities now produce Tucson, Santa Fe, Ioniq, and Genesis models — specifically to avoid Section 232 and IEEPA exposure on the U.S. market. Our Section 232 tariffs guide covers automotive Section 232 in detail.
Top Affected HTS Chapters and Sectors
South Korea’s tariff exposure concentrates in vehicles (Section 232 + IEEPA), steel (TRQ mechanics), and to a lesser extent semiconductors (IEEPA on high-value shipments).
Passenger Vehicles and Auto Parts (Ch 87)
Hyundai and Kia together export approximately $20 billion in Korean-assembled vehicles to the U.S. annually. Section 232 at 25% applies to all Korea-assembled vehicles regardless of KORUS status. IEEPA adds 10–25% depending on pause status. The effective rate on Korea-assembled passenger vehicles during the pause (37.5%) has accelerated Hyundai and Kia’s U.S. assembly expansion — reducing but not eliminating Korean import volumes. Our Captain tariff tracker monitors Section 232 auto rates in real time.
Semiconductors and Memory (Ch 85)
Samsung Electronics and SK Hynix supply approximately 70% of global DRAM memory and significant NAND flash memory to the U.S. market. Semiconductors enter at 0% MFN under KORUS; IEEPA adds 10% (pause) or 25% (post-pause). A potential Section 232 semiconductor tariff (25%+) — similar to the investigation covering Taiwan-origin chips — would affect Korean semiconductor exports significantly. Samsung’s Austin, Texas fab (fabrication of chips in the U.S.) provides partial U.S.-origin supply as a natural hedge against Korean-origin tariffs.
Steel and Flat-Rolled Products (Ch 72–73)
POSCO is Korea’s dominant steel producer and a major U.S. flat-rolled steel supplier. Within-TRQ Korean steel enters at 0% under KORUS steel exception; over-quota steel faces 25% Section 232. The TRQ cap at ~70% of historical volumes means heavy-use quarters can exhaust the TRQ before quarter end, creating mid-quarter rate jumps for subsequent Korean steel imports. Our steel and aluminum tariffs analysis covers TRQ mechanics in detail.
Consumer Electronics (Ch 85)
Samsung OLED TVs, LG OLED panels, and LG appliances — produced in Korea — enter at 0% MFN under KORUS for most electronics HTS subheadings. IEEPA applies: 10% during pause, 25% post-pause. For large-screen OLED TVs valued at $1,500–$5,000 per unit, IEEPA at 10–25% represents a $150–$1,250 duty per unit that retailers must absorb or pass through.
KORUS FTA: What Qualifies and What Doesn’t
KORUS is the largest U.S. bilateral FTA after USMCA, but it has important exceptions that importers must understand to correctly calculate duty exposure.
KORUS Rules of Origin
KORUS ROO for most industrial goods requires tariff classification change from covered HTS headings plus a regional value content test. Electronics and machinery typically require substantial transformation in Korea or from Korean-origin inputs. Unlike USMCA, KORUS does not have a high RVC threshold for most manufactured goods — making qualification more accessible for Korea-assembled goods with Korean components. However, goods with high Chinese or Japanese input content may fail KORUS ROO and revert to MFN/IEEPA rates.
Products Still Subject to Tariffs Under KORUS
Section 232 tariffs apply regardless of KORUS status — KORUS does not override Section 232 authority. Passenger vehicles carry 2.5% under KORUS (not 0%). Some agricultural products retain MFN rates. And IEEPA interaction with KORUS preferences is subject to ongoing USTR and CBP clarification — importers should verify current KORUS/IEEPA carve-out status with our trade advisory services team.
How Importers Calculate Landed Cost on South Korea-Origin Goods
KORUS provides a strong foundation for most industrial goods at 0%, but the Section 232 layer on vehicles and the IEEPA layer on all goods require scenario modeling beyond the KORUS base rate.
Worked Example
Annual procurement of $50M in Korea-origin DRAM memory (HTS 8542.32, 0% MFN, KORUS 0%): IEEPA pause (10%) = $5M duty. IEEPA post-pause (25%) = $12.5M duty. Delta = $7.5M annually on a single memory procurement program. Our Captain tariff tracker and tariff consulting firm provide Korea-specific IEEPA and Section 232 scenario planning.
Common Landed-Cost Pitfalls
- Assuming KORUS eliminates Section 232 auto exposure — KORUS does NOT exempt Korean vehicles from Section 232.
- Claiming KORUS 0% without verifying ROO compliance when goods contain high Asian-origin component content.
- Missing the TRQ fill timing for Korean steel — exhausted TRQs can shift effective rates from 0% to 25% mid-quarter.
- Overlooking IEEPA on KORUS-qualifying electronics — KORUS provides MFN rate reduction, but IEEPA is a separate authority that may still apply.
Mitigation Strategies for Importers Sourcing from South Korea
South Korea’s tariff position offers KORUS as the primary mitigation tool for most industrial goods, with Section 232 exclusion and FTZ deferral as secondary strategies for automotive and steel.
KORUS Origin Qualification
Ensuring KORUS ROO compliance for Korea-origin goods is the primary strategy for most importers — reducing applicable tariffs from IEEPA rates to 0% (or 2.5% for autos). Working with Korean suppliers to document ROO compliance, including tariff classification change analysis and RVC calculations, protects KORUS claims from CBP post-entry audits.
Section 232 Steel TRQ Management
For Korean steel importers, TRQ monitoring and shipment timing within quarterly quota windows is the highest-value operational strategy. Our tariff and customs duty consulting team monitors Korean TRQ fill rates and advises on shipment entry timing to secure within-TRQ rates. See the steel and aluminum tariffs guide for TRQ mechanics.
FTZ Options for Electronics and Semiconductor Procurement
Foreign Trade Zones defer IEEPA duty payments on Korea-origin semiconductors and electronics. For high-volume Samsung or SK Hynix procurement programs, FTZ admission defers multi-million-dollar IEEPA deposits. Withdrawal timing can be managed around IEEPA rate change signals, providing operational flexibility unavailable to standard entry importers.
Frequently Asked Questions
What is the current U.S. tariff rate on South Korea imports?
KORUS-qualifying goods: 0% (most industrial goods) or 2.5% (passenger vehicles). Section 232 adds 25% on Korean-assembled vehicles regardless of KORUS status. Korean steel within TRQ: 0% + IEEPA = 10% (pause); over-quota: 25% Section 232. IEEPA (10% pause / 25% post-pause) applies to non-KORUS-exempt goods. Check the Captain tariff tracker for HTS-level rates and KORUS interaction status.
Are South Korea tariffs still in effect in 2026?
Yes. KORUS provides 0% access for qualifying goods, but Section 232 auto tariffs (25%) and steel TRQ (25% over-quota) remain active. IEEPA (10% pause / 25% announced rate) applies to non-KORUS goods or where KORUS does not override IEEPA authority. The underlying KORUS framework is active and continues to provide preferential access for qualifying goods.
Which HTS chapters carry the highest U.S. tariff on South Korea-origin goods?
Highest effective rates: Korean-assembled passenger vehicles (Ch 87) — 2.5% KORUS + 25% Section 232 + 10–25% IEEPA = 37.5–52.5%; steel over TRQ (Ch 72–73) — 25% Section 232 + IEEPA. Semiconductors (Ch 85) and consumer electronics face 0% KORUS rate + IEEPA (10–25%), making them more favorable categories.
How does the tariff stack layer on a single entry?
KORUS rate (0% or 2.5%) + IEEPA (10% pause / 25% post-pause) + Section 232 (25% autos; 25% steel over TRQ; 10% aluminum) = effective rate. For KORUS-qualifying non-auto goods: 0% + IEEPA = 10–25% effective. For vehicles: 2.5% + 25% Section 232 + 10% IEEPA = 37.5% during pause. Each layer applies additively to the same customs value.
Can I use an FTZ to defer U.S. tariffs on South Korea imports?
Yes. Foreign Trade Zones defer IEEPA and Section 232 duty payments on Korea-origin goods. For semiconductor and electronics importers, FTZ deferral is valuable given IEEPA rate volatility. KORUS-qualifying goods at 0% MFN gain no duty benefit from FTZ admission but may use FTZ for inventory management purposes.
Are South Korea tariffs eligible for drawback or refund?
IEEPA and Section 232 duties paid on Korean goods qualify for manufacturing drawback (99% under 19 USC 1313) when incorporated into exported finished products. U.S. electronics manufacturers importing Korean semiconductors and exporting finished electronics can structure manufacturing drawback programs on the exported portion of production. Our trade advisory services team structures drawback programs.
How often do U.S. tariff rates on South Korea change?
IEEPA rates change on executive-order timelines — multiple changes since April 2025. Section 232 TRQ fill rates change quarterly. KORUS-specific modifications require Congressional involvement and are rare. The Captain tariff tracker monitors Korea-specific rate changes and provides alerts.
