The 19% US tariff rate applies to goods entering the US for consumption.
The reduction of the United States’ reciprocal tariff rate on Malaysian goods from 25% to 19% marks a significant achievement, reflecting Malaysia’s systematic negotiation strategy and effective inter-agency collaboration, said Tengku Datuk Seri Zafrul Abdul Aziz.
The Ministry of Investment, Trade and Industry (Miti) said the revised tariff followed sustained bilateral engagement with the US.
“The 19% rate is broadly in line with that of other South-East Asian countries. Importantly, Malaysia held firm on several ‘red line’ items, securing this outcome without compromising the country’s sovereign right to implement key policies to support socio-economic stability and growth,” said Zafrul in a statement on Friday (Aug 1).
He added that Miti would continue working with other ministries and agencies to mitigate the impact on Malaysian exporters and support small and medium enterprises (SMEs) in adjusting to the new rate.
The United States remains Malaysia’s largest export market, with exports valued at RM198.65 billion. It is also the top foreign investor in Malaysia, with approved investments totalling RM32.82 billion in 2024.
The new 19% US tariff rate will take effect in seven days and apply to goods entering the US for consumption, with limited exceptions for shipments already in transit.
Signed on July 31, 2025, the order amends Executive Order 14257, imposing revised ad valorem duties on multiple trading partners, including major ASEAN nations. Malaysia, Thailand, Indonesia, the Philippines, and Cambodia each face a 19% rate, while Vietnam faces a slightly higher rate of 20%.
Singapore retains the lowest tariff among ASEAN countries at 10%, whereas Laos and Myanmar face the highest at 40%.
According to a statement on the White House website dated July 31, the tariff changes will apply to goods entered for consumption, or withdrawn from a warehouse for consumption, from 12:01am Eastern Daylight Time, seven days after the order’s issuance.
However, the new rate will not apply to goods already in transit on the final mode of transport before that time, provided they are entered for consumption by 12:01am EDT on October 5, 2025.
“It shall not be subject to such additional duty and shall instead remain subject to the additional ad valorem duties previously imposed in Executive Order 14257, as amended,” the White House stated.
Yesterday, Prime Minister Datuk Seri Anwar Ibrahim, who is also Finance Minister, said he held a phone conversation with US President Donald Trump at 6:50am to discuss the tariffs within the context of free trade.
He noted that negotiations on the matter were ongoing between Miti and both the US Trade Representative and the Secretary of Commerce.
On July 7, Washington announced a 25% tariff on all Malaysian imports, separate from sectoral tariffs, effective August 1 — one percentage point higher than the 24% announced in April. Trump said no tariffs would be imposed if Malaysian firms relocated their manufacturing to the US.
Malaysia has been negotiating with Washington since April to reduce the previously imposed 24% rate. The latest talks took place on June 18, when Zafrul travelled to Washington to meet US Trade Representative Jamieson Greer, along with other US officials and investors, to discuss the tariff issue.