Section 301 Tariff Implementation Updates
12/17/18 – China Tariff Hike Delay Formalized; Beijing to Lower Import Duties on U.S. Autos
The Office of the U.S. Trade Representative published on its web site Dec. 14 a formal notice of the tariff increase delay that is expected to be published in the Federal Register in the coming days. As a result, U.S. Customs and Border Protection should be able to quickly make the necessary changes in the Automated Commercial Environment to ensure that the additional tariff does not increase to 25 percent until 12:01 a.m. on March 2. As a result, Sandler, Travis & Rosenberg’s Tom Gould said, there is less need for importers to consider electing the arrival date as the entry date for shipments due to arrive in the coming weeks." Read more.
12/5/18 – Tentative 90-day Truce on U.S.-China Tariffs Provides Temporary Relief
A tentative, three-month pause on the trade war may provide enough time to resolve differences over Chinese tactics. "According to the White House account, the U.S. would hold off on imposing 25 per cent tariffs on $200 billion of imports ... until March 1, and China would agree to immediately enter negotiations to resolve thorny issues such as forced technology transfer, protection of intellectual property, non-tariff barriers and cyber theft." Read more.
However, "China seems to have a markedly different view of the trade war cease-fire ... with state media outlets making no mention Monday of a 90-day time frame or a reduction in tariffs on imported U.S. cars — or indeed any specifics about buying more American products." Read more.
10/30 – US Considering Additional Tariffs on Remaining $257 billion in Chinese Goods if Trump-Xi Talks Fail
This possible new round of taxes on goods from China could be implemented as early as December and cover the remaining imports from China, about $257 billion worth. Read more.
10/16 – MTB Duty Reductions Won’t Supersede China Import Tariffs, CBP Says
The Miscellaneous Tariff Bill Act (MTB) suspends or reduces duties on 1,660 products entered or withdrawn from warehouse for consumption on or after Oct. 13 through Dec. 31, 2020. About half the MTB-eligible items are produced in China and may therefore be subject to the Section 301 tariffs imposed by the Trump administration on a wide range of imports from China. While such products can benefit from the MTB’s suspensions and reductions for the general rates of duty, they remain subject to the 25 or 10 percent duty rate as applicable. Read more.
9/24 – IEWC has analyzed List 3 for potential impacts to our customers. Products that are included on the list that might affect customers include:
Contact your sales person if you have specific questions about items you procure from IEWC.
9/18 – List 2 exclusion requests are due by Dec. 18, 2018. Learn more.
9/17 – List 3 of Section 301 tariffs will go into effect Sept. 24, 2018. The initial tariff rate of 10% will increase to 25% as of Jan. 1, 2019. Read the USTR news release for more information.
While the effects of this revised list of products are still being reviewed, we continue to monitor and quickly advise all affected parties. Please bookmark and visit this page regularly for the latest information about tariffs.
9/12 – The Art of the Trade Deal 2.0: Update on Top Strategies to Avoid or Reduce Section 232 and 301 Duty Increases
Sandler, Travis & Rosenberg's recent Trade Report examines various tactics that importers of products originating in China can use to mitigate the impact of recent Section 232 and 301 tariffs. Read the full article. Be sure to consult appropriate legal counsel with trade expertise before implementing any of these strategies as many have specific requirements, as well as specific benefits and drawbacks.
9/4 – Hearings on List 3 goods and the effective tariff rate they could be subject to (10% to 25%) wrapped up on Monday, Aug. 27. Rebuttal comments are due by Thursday, Sept. 6.
The List 2 exclusion form has not yet been published.
For those interested in a comprehensive compilation of all retaliatory tariffs, Sandler, Travis & Rosenberg has created this list.
8/14 – Final Version of List 2 US/China Tariffs Published
The second set of tariffs on products of Chinese origin has been enacted and duties will be collected beginning Thursday, Aug. 23. The 25% duty on products that appear on List 2 applies to all designated products that are imported from that day forward. Any existing inventory in the USA is unaffected.
The only product category subject to these new tariffs on List 2 that affects IEWC suppliers and customers is heat shrink tubing. However, we expect minimal effects from this tariff as only one class of heat shrink tubing is included in the list. The second class of tubing -- of which IEWC supplies much more -- is not included in this list of products.
While the effects these new tariffs will have on suppliers and customers are still being reviewed, we continue to monitor and quickly advise all affected parties as we learn details. In the meantime, we continue to post regular updates on this web site. Please bookmark and visit the page regularly for the latest information about the effects of the new tariffs on our customers and suppliers.
As you navigate these trade-related challenges, you can rely on us for accurate advice from our trade compliance specialists and salesforce. These teams continue to work hand in hand to reduce potential supply disruptions and other tariff-related effects on customers in these uncertain times.
Thank you for your continued business. We will keep you apprised as the situation changes.
8/9 – Finalized List 2 of Goods Subject to 25% Tariff Published
"The Office of the U.S. Trade Representative has finalized a proposal to extend the 25 percent tariff that the U.S. imposed July 6 on $34 billion worth of Chinese goods to an additional $16 billion worth of imports from China. U.S. Customs and Border Protection will begin collecting additional duties on these products Aug. 23. " Read more.
8/8 – Word on the street from licensed customs brokers is that companies are importing as much inventory into the US as they can now, in the likely event that Lists 2 and 3 go into effect in the near future. Bunker rates (variable fuel surcharges) have also increased this summer, further increasing shipping costs for companies importing to the US from China.
8/2/18 – Proposed List 3 Tariff Possibly Increasing from 10% to 25%
The 10% duty originally announced on the 6,031 products included on List 3 may be increased to 25% based on a new directive by President Trump. List 3 is available here.
“USTR’s previously announced hearing on the possible tariff increase will still be held Aug. 20-23 in Washington, D.C. However, requests to appear at the hearing are now due by Aug. 13 and the deadline for post-hearing rebuttal comments has been extended from Aug. 30 to Sept. 6.” Read more here.
8/1 – The List 2 tariff hearings were held on 7/24, which were followed by collection of rebuttal comments through the end of the July. Hearings on List 3 are scheduled for August 20-23, 2018.
7/31 – “Factories shift out of China to avoid trade war, boosting volume for logistics firms like Kerry”
Tariffs are accelerating the rate at which firms are moving business from China to other rapidly industrializing Asian economies outside of China. Growing competition in China is causing labor and land prices to rise, making other countries in the nation more attractive to businesses looking to expand while decreasing operating expenses. The enactment of tariffs has increased the pace of this movement. Read full article in the South China Morning Post.
7/24/2018 - What do these tariffs mean for IEWC’s non-US Customers?
With so much focus on the countries who are enacting tariffs like the US and China, it is easy to lose sight of the fact that manufacturers in other countries can be impacted as well. Why’s that? It’s all about the Country of Origin. If a product bound for a site in Canada, for example, is receiving product from a US supplier but Country of Origin or where the product was produced is China, they are still at risk of being impacted by the US tariffs.
So what is IEWC doing to help our non-US customers? Whenever possible, we will work with those customers to ship product directly to the final country destination to avoid a logistics plan that passes the product through the US along its way. In addition, IEWC actively looks for opportunities to pre-clear materials through US Customs whenever possible. Pre-clearing allows the inbound materials to clear US Customs several days in advance of its arrival to the US. This could be particularly valuable once the timing of the List 2 and List 3 materials is announced and the go-live dates of additional tariffs are determined.
Click here for additional mitigation strategies, The Art of the Trade Deal: Top Five Strategies to Avoid or Reduce Section 232 and 301 Duty Increases.
7/23/2018 - Tariff Lists 1, 2 & 3: Where do we stand how can I mitigate exposure?
Lists 2 and 3 of the 301 tariff have not yet been implemented, only List 1.
7/16/2018 - This article from Industrial Distribution provides a useful FAQ about tariffs:
"Q: SO WHAT ARE TARIFFS?
A: Tariffs are a tax on imports. They're typically charged as a percentage of the transaction price that a buyer pays a foreign seller.
In the United States, tariffs — also called duties or levies — are collected by Customs and Border Protection agents at 328 ports of entry across the country. Proceeds go to the Treasury. The tariff rates are published by the U.S. International Trade Commission in the Harmonized Tariff Schedule, which lists U.S. tariffs on everything from dried plantains (1.4 percent) to parachutes (3 percent).
Sometimes, the U.S. will impose additional duties on foreign imports that it determines are being sold at unfairly low prices or are being supported by foreign government subsidies."
7/11/2018 - Office of the US Trade Representative announced preliminary third list of products slated for additional 10% duty under section 301. This additional tariff is expected to be finalized in August.
07/09/2018 - Many electrical products with a country of origin of China are affected by Section 301 tariffs that went into effect July 6 for all designated products that are imported from that day forward. Any existing inventory in the USA is unaffected.
While the current situation is fluid, IEWC's trade compliance team continues to monitor the situation and will advise our customers as the situation warrants.
7/06/2018 - Section 301 tariffs take effect. The affected products are divided into two lists that have been “identified by the interagency Section 301 Committee as benefiting from Chinese industrial policies, including the ‘Made in China 2025’ industrial policy:"
We have identified: