President Donald Trump notified Japan of 25% tariff rates on Monday, effectively extending negotiations until August 1 as Japan’s July 20 upper house election constrains deal-making.
Trump’s 90-day pause on “reciprocal” tariffs expires Wednesday. Treasury Secretary Scott Bessent acknowledged Japan’s “domestic constraints,” telling CNBC, “We’ll see where the Japanese deal goes.”
Japanese negotiator Ryosei Akazawa made seven U.S. trips in April-June, but automobile tariffs remain sticking points. Prime Minister Shigeru Ishiba told NHK Japan won’t “make easy compromises.” The Liberal Democratic Party-Komeito coalition needs 50 seats for stability.
The LDP-Komeito coalition is facing challenges in key single-member districts, which are critical to the election outcome, according to a Nikkei survey conducted on Thursday and Friday.
Any announcement of a tariff increase during the campaign period could further damage support for the Ishiba administration. According to Nikkei, political weakness would limit Japan’s negotiating flexibility on major concessions.
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