Understanding the U.S.-Singapore Free Trade Agreement (USSFTA) and Its Impact on Tariffs in 2025

The U.S.-Singapore Free Trade Agreement (USSFTA), effective since 2004, eliminates tariffs on most Singaporean exports to the U.S., providing tariff preferences and facilitating trade in goods and services between the two countries. However, in 2025, the U.S. introduced new baseline tariffs of 10% on imports from Singapore and many other countries, which generally apply even to goods that qualify under the USSFTA, meaning USSFTA tariff exemptions do not automatically exempt goods from the new 10% U.S. tariffs.

Key points about the USSFTA and its impact on tariffs in 2025:

• The USSFTA binds Singapore’s tariffs on U.S. goods at zero and grants U.S. exporters preferential access to Singapore’s market, while also eliminating tariffs on most Singapore-origin goods entering the U.S..

• The agreement includes rules of origin that exporters must comply with to qualify for tariff preferences. Non-compliance can lead to loss of USSFTA benefits.

• Despite the USSFTA, the U.S. imposed a 10% baseline tariff on imports from Singapore starting April 5, 2025, as part of broader U.S. tariff policies aimed at protecting domestic industries. These tariffs apply to Singaporean goods unless specifically exempted by U.S. executive orders.

• Some goods may be exempt from the 10% tariff under specific U.S. regulations, but these exemptions are limited and separate from USSFTA provisions.

• The introduction of new U.S. tariffs has increased complexity for exporters, requiring careful customs classification, documentation, and verification to maintain tariff preferences under the USSFTA.

• The USSFTA remains a critical framework for trade relations, providing a foundation for tariff elimination and trade facilitation, but exporters must navigate the overlay of new U.S. tariff measures in 2025.

In summary, while the USSFTA continues to provide tariff advantages and trade facilitation between Singapore and the U.S., the new 10% U.S. tariffs introduced in 2025 generally apply to Singaporean imports, requiring exporters to carefully manage compliance and documentation to maximise benefits and avoid additional costs.