SFIA Actively Seeks Tariff Relief for Sports & Fitness Industry
The industry received some good news on the trade front in April. The Administration announced actions on List 3 China exclusions, tariff deferrals and the Miscellaneous Tariff Bill (MTB) duty relief, which will lower SFIA members’ tariff exposure.
Miscellaneous Tariff Bill (MTB)
On April 9th, the Department of Commerce released results of the initial review of Miscellaneous Tariff Bill petitions requesting duty relief on products no longer made in the United States. The initial report found no opposition to 78 out of the 84 petitions SFIA filed on behalf of members. SFIA is proud that 92% of our petitions had no objections, compared to 61% of petitions (35 of 57) filed outside SFIA having no objections.
An MTB report will be sent to Congress by June 9, 2020 and the ITC recently announced it will hold second-round public comments June 12–22 to allow for objections to any petition. SFIA will work with our petitioners on submission of comments for any objections. Each approved MTB petition is estimated to provide $500,000 in tariff relief annually. (If all 78 SFIA petitions are approved, that would be about $40 million in duty relief per year.)
Last Wednesday, April 21st, the President issued an Executive Order to defer certain duty payments for 90 days. Companies that can show “severe financial hardship” due to COVID actions are eligible for duty deferral. Products subject to anti-dumping & countervailing duties or Section 301, 232 or 201 are not eligible for duty deferral.
Businesses must meet the following two conditions to show “Significant Financial Hardship”:
1. Operations are fully or partially suspended during March & April due to government mitigation policies;
2. Gross receipts off 60 percent from March 13–31 or April 2020 for same periods in 2019.
Companies do not have to apply with the CBP to receive deferrals, but need to maintain records showing compliance, should CBP conduct a post-entry audit to verify. Importers may file two entries for a single product, one for tariff, including AD duty, and one which does not.
CBP will waive interest, penalties, liquidated damages or other enforcement actions on deferred duties.
Link to official announcement:
SFIA joined other businesses and organizations as we signed on to a letter sent to President Trump on April 28th thanking him for the duty deferrals and requesting expansion of the deferral program. Specifically, we requested the coverage period be extended to cover May & June and requesting the duty deferrals apply to ALL duties.
China List 3 Exclusions
The USTR continues to review requests for product exclusions from the Section 301 tariffs. USTR is still working through more than 30,000 List 3 Exclusion requests and while they ruled on a handful of medical supplies on List 4A, they are not expected to do more on List 4A until they near completion of List 3 requests.
On April 22nd, the USTR released its latest round of approved List 3 Exclusion requests. In all, 107 petitions were accepted, including three SFIA petitions for football helmet components and travel golf bags. The exclusions apply to tariffs from September 24, 2018 through August 7, 2020.
SFIA will continue to press for additional Exclusions from China tariffs as the USTR works through the backlog of requests.
For additional information please contact Bill Sells, SFIA Senior Vice President of Government & Public Affairs at email@example.com.