Israel in talks with US to reduce Trump tariffs

Business Recorder ^ | 04/04/2025

[SeekAndFind]

JERUSALEM: Israel is in talks with its main ally the United States to reduce tariffs imposed by President Donald Trump as part of a global salvo, according to the finance minister.

Trump hit friends and foes alike with his sweeping “Liberation Day” tariffs this week, making his announcement just a day after Israel lifted all of its remaining customs duties on US imports.

Trump reserved some of the harshest duties for major trade partners, while goods from Israel, a top beneficiary of US military aid, were hit with a 17 percent tariff.

“The Ministry of Finance is maintaining an ongoing dialogue with the US administration with the aim of reducing the scope of the tariffs and reducing their impact on Israeli industry,” Finance Minister Bezalel Smotrich wrote on X on Thursday.

Smotrich had met with his US counterpart Scott Bessent in Washington in March.

On Tuesday, he announced Israel’s lifting of all remaining duties on US imports, affecting the one percent of American goods that were still subject to them.

After Trump announced his tariffs, the Israeli executive faced harsh criticism over its lifting of its own duties.

“Smotrich rushed to remove all tariffs on imports from the US to Israel, and in response received 17 percent tariffs on imports of goods from Israel to the US. Genius,” centrist Israeli lawmaker Vladimir Beliak wrote on X.

Israel’s Manufacturers Association (MAI) said Trump’s tariff announcement had taken it completely by surprise.

“It appears that the imposition of the customs duty is probably related to the US trade deficit with Israel,” the body said in a statement.

In a separate statement on Thursday, the MAI said the decision posed “a major challenge” to Israel’s economy.

It also said it was in contact with US and Israeli authorities “in order to guarantee Israel’s exemption and/or reduce the taxes imposed”.

In 2024, the United States had a trade deficit with Israel of some $7 billion, according to data from the US Department of Commerce.

[Sarah Barracuda]

I thought they already did as a good will gesture

[FreedomNotSafety]

Who is they? Israel or the US?

[FreedomNotSafety]

Trump said he wants tariffs to be zero but that doesn’t mean he will go to zero just because the other country goes to zero.

I think most of MAGA wants Fair Trade which simply means equalizing prices so that any advantages the foreign country may have are erased. Or maybe it means zero tariffs, or maybe it means all good paying jobs belong to us, or it could mean no imports at all, or maybe it means raise tariffs to protect my job but bit not on the stuff I buy.

[Gen.Blather]

I do not understand the market hysteria. Trump has been proven right time and time again.

[Liz]

The tariff decision poses “a major challenge” to Israel’s economy. Israeli authorities contacted the US “in order to guarantee Israel’s exemption and/or reduce the taxes imposed”. In 2024, the United States had a trade deficit with Israel of some $7 billion, according to data from the US Department of Commerce.

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OTOH, China is Israel’s 2nd largest trading partner,
with total trade value reaching a whopping $24.45 billion.

BACKSTORY-—Trump and Biden restricted sensitive technological exports to China. As a result, China turned to cooperative Israel. China’s direct investment in Israel’s IT industry, especially in chips and semiconductors, now has increased.

In 2017, Israeli PM Netanyahu said China accounts for one-third of the investment in Israeli high technology, which includes US military technology the US shares w/ Israel, its strongest ally. In the ’90s, Israel sold military equipment and technologies to China, including the Harpy missile system.

This incident chilled relations between the United States and Israel, with Israel being suspended from its status as Security Cooperative Participant in the Joint Strike Fighter program. However, on 6 November 2005, Israel stated that it has been re-admitted into the program.

The US had to pressure Israel to stop sharing US military technology w/ China. Yet Israel still doesn’t restrict China from acquiring dual-usage technologies that could have military implications against the US.

A succession of US administrations warned Israel about its growing tie with China, sharing concern about China using Israel as a backdoor to access sensitive technologies from the US.

The most vocal objection to Sino-Israeli ties came from the Trump administration. When former Secy of State Mike Pompeo visited Israel in 2019, he warned Israelis that the CCP “engages in spying through its commercial state-owned enterprises and presents risk through its technology systems. Pompeo said China’s actions posed a risk.

Unfortunately, Israel largely brushed aside the warnings. Like many other countries, China’s massive market has enticed Israel. Plus, the Israeli government hopes China’s good relationships with Arab nations may help Israel.

Netanyahu was working on a Sino-Israeli free trade agreement and planned to visit China. But China’s siding w/ Hamas alerted Israel’s leaders to the reality that Communist China’s relationship with Israel is purely transactional.

[Theoria]

Any country that receives foreign aid from the US shouldn't have a tariff with US.

[jjotto]

Israel has almost no tariffs on US products except for a couple ag products that are inconsequential and those are being eliminated. The Trump objection is that Israel exports more to the US than it imports from the US (military excluded).

This is a balance-of-trade issue, not a tariff issue. At 10 million people with sky-high taxes and cost of living, it will be interesting to see what changes can be made in Israel.

[SaxxonWoods]

Ric Grenell said today that there are many countries already in touch and wanting to make a deal. He said people will be shocked soon.

[Liz]

in 2024, Biden blanketed Israel with $12.5 billion tax dollars.
In March 2025, Marco Rubio Speeds $4 Billion in Military Aid to Israel.

Tel Aviv is home to most of Israel’s foreign embassies. It is a beta+ world city and is ranked 57th in the 2022 Global Financial Centres Index. Tel Aviv has the third- or fourth-largest economy and the largest economy per capita in the Middle East. A “party-happy capital” in the Middle East, it has a lively nightlife and 24-hour culture. The city is gay-friendly, with a large LGBT community. The tiny state of Israel’s per capita GDP is on par with most Western European nations at $54,660, while in Palestinian territories the per capita GDP is $3789.00.

PBS.com ——— Record military aid to Israel — a dependent of the United States since its founding is the biggest recipient of U.S. military aid in history, getting $251.2 billion in inflation-adjusted dollars since 1959, the report says. $17.9 billion in us aid since Oct. 7, 2023, is by far the most military aid sent to Israel in one year. The U.S. committed to providing billions in military assistance to Israel each year and an agreement since the Obama administration set the annual amount for Israel at $3.8 billion through 2028.

The US aid since the Gaza war started includes its annual billions, Biden's $12.5 billion USAID, military gifts, arms worth at least $4.4 billion in giveaways from US defense stockpiles.