In a move aimed at leveling the playing field and countering what they perceive as unfair competition from China, the Biden administration intends to raise tariffs on electric vehicles and other clean energy goods from China. According to sources familiar with the matter, the tariff rate on Chinese electric vehicles is set to increase significantly, from 25% to approximately 100%.

The planned tariff hike will also apply to Chinese batteries and solar panels, which are two key areas the Biden administration has been focusing on domestically. The announcement regarding the tariff increase is expected to be made next week, with Tuesday being the tentative date, although the timing could still change. The Wall Street Journal was the first to report the planned tariff hike.

Treasury Secretary Janet Yellen is due to attend the G7 Finance Ministers meeting in Italy later this month, where the U.S. hopes to coordinate similar actions from other countries in order to present a united front against China. Yellen, in an interview this week with Marketplace, expressed concerns about the competitiveness of the U.S. in the electric vehicle and batteries industry, stating that China is massively subsidizing investment in these sectors to fuel their growth prospects.

This move comes after almost two years of backlash from U.S. allies, who have accused the U.S. of undercutting their green energy economies with the incentives provided in the Inflation Reduction Act signed by President Biden. Responding to these concerns, many of these allies have created their own versions of the act to compete with the U.S., and are now seeking to join forces against their mutual competitor: China.

President Biden himself recently called for tripling tariffs on Chinese steel and aluminum during a speech to union members in Pennsylvania. He criticized China for overproducing goods to flood the U.S. market, driving down prices and harming the American economy. Biden referred to China's state-funded support for its steel industry as unfair and detrimental to American interests.

It is worth noting that former President Donald Trump had previously expressed the possibility of imposing a 60% tariff on all Chinese imports if re-elected. During his administration, the U.S. imposed tariffs on various imports, including washing machines, solar panels, steel, aluminum, and billions of dollars' worth of goods from China. President Biden has largely maintained these tariffs imposed by his predecessor.

As the Biden administration gears up to quadruple tariffs on Chinese electric vehicles and clean energy goods, the move highlights their determination to address what they view as imbalanced trade practices and unfair competition in the green energy sector. The hope is that this action will encourage other countries to join forces and present a united front against China's subsidization of critical industries.