From Washington

Trump Delays 25% to 30% Increase in Punitive Tariffs on U.S. Travel Goods Imports from China

Trump Delays 25% to 30% Increase in Punitive Tariffs on U.S. Travel Goods Imports from China

On October 11, in a press conference with Chinese Vice Premier Liu He announcing a “Stage 1” trade deal between the U.S. and China, President Trump announced that the increase in punitive tariffs on U.S. travel goods imports from China would NOT increase from 25% to 30% on October 15, as previously scheduled. TGA had repeatedly urged President Trump to not increase the punitive tariffs (TGA comments, TGA-organized industry letter, business community letter). While there is still no official announcement, President Trump confirmed the delay, stating in a “helicopter talk” late on October 11 that, “We’re going to hold off on the 5% increase from 25% to 30%.” Please note that the announcement only delays the increase in punitive tariffs on U.S. travel goods imports from China from 25% to 30%, which means the 25% punitive tariffs on U.S. travel goods imports from China remain in place. The 25% punitive tariffs are in addition to the normal 17.6%-20% tariffs on most travel goods imports.

China Tariff Exclusion Process Moves Slowly

China Tariff Exclusion Process Moves Slowly

The U.S. government’s review of the 30,331 tariff exclusions requests for the 25% punitive tariffs on U.S. imports from China filed by the September 30 deadline remains excruciatingly slow, with the U.S. government having only reviewed 439 petitions, or a mere 1.4% of all petitions filed to date. Further, only 61 petitions have been approved to date, none for travel goods. Before the deadline, 146 companies filed a combined 863 exclusion petitions on travel goods. To date, 31 of those petitions have been denied. TGA has urged the U.S. government to accelerate its review.

China Tariff Exclusion Portal Now Closed – Still Time to File Responses in Support of Petitions

China Tariff Exclusion Portal Now Closed – Still Time to File Responses in Support of Petitions

The portal to request exclusions from President Trump’s 25% punitive tariffs on U.S. travel goods imports from China closed September 30. However, there is still time to file responses in support of many of the hundreds of travel goods-related exclusion petitions filed. Go to the exclusions web portal to see all of the petitions.

If an exclusion is granted on a certain product, any U.S. import of that product is eligible for refunds of all punitive tariffs paid from September 2018 until August 7, 2020. Note that petitions (and respondents) must show that the punitive tariffs have caused economic harm AND that there is no alternative source for the product outside of China, at least not without immense costs and a lot of time.

In total, companies filed 30,335 petitions requesting exclusions from the punitive tariffs on U.S. imports from China. For travel goods, 146 companies filed a combined 863 petitions requesting exclusions for certain travel goods. More than 400 travel goods petitions were filed in the final week before the deadline. To date, the Office of the U.S. Trade Representative (USTR) has granted exclusions for 61 petitions (none in the travel goods space) and denied 378 petitions, including 30 travel goods petitions.