Sadie Keljikian, Express Trade Capital
The following is an update on recent tariff adjustments on steel, aluminum, and Chinese-made products.
Steel and Aluminum Products:
Several Presidential Proclamations signed in March 2018 have collectively implemented Section 232 of the Trade Expansion Act of 1962. The Proclamations primarily serve to adjust imports of aluminum and steel into the United States. The proclamations indicate that covered steel mill and aluminum product imports will be subject to additional tariffs of 25% ad valorem and 10% ad valorem respectively. The following products are covered:
- Steel mill product HTSUS classifications:
- 10 through 7216.50 including bars, rods, ingots and angles.
- 99 through 7301.10 including wire, bars, rods, ingots and sheet piling.
- 10 rails.
- 40 through 7302.90 including sleepers and plates.
- 11 through 7306.90 including pipes, hollow profiles and tubes.
- Aluminum product HTS classifications:
- 7601, unwrought aluminum.
- 7604 including rods, profiles and bars.
- 7605, aluminum wire.
- 7606 and 7607 including flat rolled products like foil, sheet, strip and plate.
- 7608 and 7609 including pipes, tubes, and pipe and tube fittings.
- 99.51.60 and 7622.214.171.124, forgings and castings.
The newly implemented tariffs will be added to all existing duties and will apply to all countries of origin except for a specific list of exempted countries. Exempted countries include Argentina, Australia, Brazil, Canada, Mexico, South Korea and European Union members, which include Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom.
As of now, exemptions are limited through April 30th, 2018, but it is unclear whether they will be extended beyond that date. Extension of the exemptions may lead to a change in the rates applied to other countries and/or restraints on quotas for some, or all countries of origin.
Products from China:
On March 22, 2018, President Trump announced his plan of action to combat China’s unfair trade practices as addressed in the USTR Section 301 investigation of China’s Policies, Acts, and Practices pertaining to Intellectual Property, Innovation and Technology Transfer. As the president’s instructions, US Trade Representative Robert Lighthizer began the investigation in August of 2017.
President Trump has indicated that action against China will be taken in three stages:
- Tariffs. Representative Lighthizer will propose a list of products with corresponding tariff increases within 15 days of the announcement on March 22, 2018. The final list will be published after a brief period for notice and comment.
- WTO dispute settlement. Representative Lighthizer will attempt to settle the dispute in the World Trade Organization, or WTO to address discriminatory practices in China’s technology licensing.
- Restricted investments. The Secretary of the Treasury will address concerns about investors in China or investments facilitated in China in US industries or technologies deemed important to the US.
On the bright side, President Trump signed an omnibus budget bill into law which aims to end the ongoing cycle of resolutions and government shutdowns. It also renews the General System of Preferences, or GSP, which seeks to ensure fair trade practices among WTO countries. The bill will extend GSP through December 31st, 2020 and retroactively renew it to the previous expiration on December 31st, 2017. Goods that arrive in between will be eligible for a refund, if indicated properly. The GSP will officially go back into effect on April 22, 2018.
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