Malaysia joins 17 economies in lowest US Section 301 forced-labour tariff tier
Malaysia has been placed in the lowest tariff tier under the United States’ Section 301 forced-labour measures, with a 10% duty taking effect at 12.01am US time on July 24.
Source: The Star · July 24, 2026 at 11:17 AM · AI-assisted report
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UNITED STATES, 24 JULY 2026 —
Malaysia has been placed in the lowest tariff tier under the United States’ Section 301 forced-labour measures, with a 10% duty taking effect at 12.01am US time on July 24.
The Ministry of Investment, Trade and Industry (MITI) said Malaysia is among 17 economies subject to the 10% rate, while the remaining affected jurisdictions face a 12.5% tariff. MITI said the lower rate reflects Malaysia’s “commitments to implement and enforce laws prohibiting the importation of forced labour goods.” The duty replaces a temporary levy imposed under Section 122 of the US Trade Act of 1974.
Separately, MITI said the ongoing Section 301 investigation into excess industrial capacity—covering 16 economies including Malaysia—has not yet resulted in a final tariff rate. Once the US Trade Representative (USTR) sets the rate, MITI will notify stakeholders and continue bilateral talks.
MITI’s statement did not quantify the expected impact on Malaysia’s export orders or earnings. The ministry attributed the lower forced-labour tariff to Malaysia’s compliance record, but did not specify which products qualify for the 10% rate or how long the excess-capacity probe will take.
Analysts said the lower forced-labour tariff reduces pressure on Malaysia’s manufacturing and plantation sectors, which ship electronics and rubber to the US. The 10% duty is 2.5 percentage points below the next tier, potentially easing cost pressures for exporters amid volatile freight prices.
Related: United States
Malaysia Impact
The reduced tariff rate may benefit Malaysian exporters and increase their competitiveness in the US market, potentially impacting the country's trade balance with the US.