US traders see deluge of offers to evade high tariffs via Malaysia

 A freight agent says most clients are directing China-made goods through Malaysia to circumvent the 145% US tariffs imposed on Chinese products.

US president Donald Trump has paused the imposition of ‘reciprocal’ import tariffs for 90 days, excluding the additional tariffs of 145% imposed on China. (EPA Images)

PETALING JAYA:

 US-based online traders importing goods from China are receiving a deluge of suspicious offers from foreign logistics firms, offering to help them avoid paying Washington’s 145% tariffs on Chinese products, says a report.

Bloomberg quoted five online merchants as saying most of these offers to “help save costs” came via social media. These were either through falsifying the value of the shipments or routing the goods through a country with lower tariff rates than China.

“We can provide the solution to help you save your costs,” one logistics company reportedly said.

According to the report, tariff-evasion services had long been offered by certain foreign logistics companies. However, these offers surged after the Donald Trump administration announced heavy tariffs on China this month.

While the traders turned down these offers, they feared that others might take them up, and this would allow them to offer lower prices.

Separately, the news outlet quoted a Chinese freight agent offering the service as saying that most of its clients were directing China-made goods through Malaysia.

This was because the US has only imposed a 24% tariff on Malaysia — which is on hold for 90 days — compared with the 145% rate for Chinese products.

However, the agent said many clients were delaying their shipments from China to see if Trump will reduce the tariff rates.

US$29,000 reduction in tariff bill

One online merchant, Aaron Rubin, said a logistics firm offered to help bring in one of his shipments from China, which the agent said would slash his tariff bill by US$29,000.

The company offered to submit falsified paperwork stating that the consignment was worth US$10,000 to US Customs and Border Protection (CBP), though the goods actually cost about US$30,000.

Rubin filed a complaint about the company to CBP, saying other merchants would be illegally saving billions of dollars soon enough if they were to keep making use of these services.

Trump has paused the imposition of “reciprocal” import tariffs for 90 days, excluding the additional tariffs of 145% imposed on China, which has responded by imposing sweeping counter-tariffs of 125% on US goods.

Yesterday, Trump said the high tariffs on China-made products will “come down substantially” but maintained that it would not be 0%. - FMT