Congress and Administration Focused on COVID as Tariff Relief Awaits Action
In 2019 SFIA launched a campaign to secure tariff relief on industry products via the Miscellaneous Tariff Bill (MTB). SFIA members provided all the relevant information for review in their MTB petitions and met every deadline for tariff relief consideration. The U.S. International Trade Commission fully vetted the MTB petitions to determine if there was domestic production and recommended all but four SFIA petitions for tariff relief. The USITC delivered their recommendations to Congress in August of 2020 for approval before the MTB expired at the end of 2020. Then things went south as the Congressional process got sidetracked by COVID and the 2020 elections.
With a change in Administration comes a change in priorities and President Biden made it very clear from day one his primary focus was getting COVID under control. Unlike the previous Administration, President Biden believes the economy cannot fully recover until we have defeated the pandemic so all other issues were put on back burner, including tariff relief. As the U.S. moves toward a return to normal, trade issues are receiving greater attention. There is concerted effort to get the Administration to act on re-opening the Section 301 Exclusion process for Chinese-made products and Congress to pass legislation to renew the Generalized System of Preferences (GSP) and MTB tariff relief programs. Expect stronger environmental and labor requirements on country eligibility for GSP when it is renewed. Previously GSP relief has been retroactive to expiration date but that is not required. MTB has unlikely to receive retroactive relief but previously tariff relief was increased to help offset tariff payments during an MTB lapse. Attention has not turned to trade yet but the expiration of the Trade Adjustment Assistance (TAA) program on June 30, 2021 provides the foundation for a trade package that includes with MTB, GSP and TAA. Timing is fluid due to focus on COVID but as long as the U.S. continues to vaccinate and gets COVID under control, a summer timeline for passage of a tariff relief package makes sense.
Exclusions from Section 301 tariffs on Chinese imports expired on December 31, 2020. President Biden stated early on that he would review the Section 301 tariffs on Chinese imports for 6 months before determining future trade path with China. With the new U.S. Trade Representative Katherine Tai confirmed and now in place, the pressure is on to re-open the Section 301 Tariff Exclusion process while the Administration reviews the current tariff policy. To date there has been no signals on re-opening the exclusion process but the longer the tariffs remain in place, the more pressure there will be on the USTR to re-open the exclusion process. A letter signed by SFIA and other business interests to the USTR asking for elimination of the Section 301 Tariffs and re-opening of Exclusion process during the review can be found here: https://mcusercontent.com/697d5698403556f603315998d/files/1da1fa25-1d94-4438-873d-bc01847483f5/AFT_Letter_to_Ambassador_Tai_031821_Final.pdf
SFIA continues to press for renewal of all tariff relief programs and are optimistic on a resolution during the summer of 2021.
For further information please contact Bill Sells, SFIA Senior Vice President of Government & Public Affairs, at bsells@sfia.org.
