News
Print PDF

Practice Areas

New Tariffs on Imports from France Slated for January

Tuesday, July 14, 2020
Sandler, Travis & Rosenberg Trade Report

The U.S. is planning to impose an additional 25 percent tariff on imports of soap, cosmetics, and handbags from France in response to that country’s digital services tax. However, application of this tariff has been suspended until Jan. 6, 2021.

For more information, please contact Nicole Bivens Collinson or Kristen Smith.

Earlier this year France enacted a three percent tax on total annual revenues generated by some companies from providing certain digital interface services (e.g., e-marketplaces for goods and services) and Internet advertising services to, or aimed at, French users. The Office of the U.S. Trade Representative has determined that this DST discriminates against U.S. companies and is inconsistent with prevailing tax principles on account of its retroactivity (to Jan. 1, 2019), its application to revenue rather than income, its extraterritorial application, and its purpose of penalizing particular U.S. technology companies.

In response, USTR had proposed to impose additional tariffs of up to 100 percent on products of France to be drawn from a list of 63 tariff subheadings with an import value of about $2.4 billion. Following public comments and further review, USTR has now determined to impose a 25 percent additional tariff on the following 21 tariff subheadings with an import value of about $1.3 billion.

- 3304.10.00 (lip makeup preparations)

- 3304.20.00 (eye makeup preparations)

- 3304.30.00  (manicure or pedicure preparations)

- 3304.91.00 (beauty or makeup powders, whether or not compressed)

- 3304.99.50 (beauty or makeup preparations and preparations for the care of the skin, excluding medicaments but including sunscreen or sun tan preparations, not elsewhere specified or included)

- 3401.11.10 (castile soap in the form of bars, cakes, or molded pieces or shapes)

- 3401.11.50 (soap, not elsewhere specified or included; organic surface-active products used as soap, in bars, cakes, pieces, soap-impregnated paper, wadding, felt, for toilet use)

- 3401.19.00 (soap; organic surface-active products used as soap, in bars, cakes, pieces; soap-impregnated paper, wadding, felt, not for toilet use)

- 3401.20.00 (soap, not in the form of bars, cakes, molded pieces, or shapes)

- 3401.30.10 (organic surface-active products for washing skin, in liquid or cream, containing any aromatic/mod aromatic surface-active agent, put up for retail)

- 3401.30.50 (organic surface-active products and preparations for washing the skin, in liquid or cream form, put up for retail sale, not elsewhere specified or included)

- 4202.21.30 (handbags, with or without shoulder strap or without handle, with outer surface of reptile leather)

- 4202.21.60 (handbags, with or without shoulder strap or without handle, with outer surface of leather, composition or patent leather, not elsewhere specified or included, not over $20 each)

- 4202.21.90 (handbags, with or without shoulder strap or without handle, with outer surface of leather, composition or patent leather, not elsewhere specified or included, over $20 each)

- 4202.22.15 (handbags, with or without shoulder straps or without handle, with outer surface of sheeting of plastics)

- 4202.22.40 (handbags with or without shoulder strap or without handle, with outer surface of textile materials, wholly or in part of braid, not elsewhere specified or included)

- 4202.22.45 (handbags with or without shoulder strap or without handle, with outer surface of cotton, not of pile or tufted construction or braid)

- 4202.22.60 (handbags with or without shoulder strap or without handle, outer surface of vegetable fibers, excluding cotton, not of pile or tufted construction or braid)

- 4202.22.70 (handbags with or without shoulder strap or without handle, with outer surface containing 85 percent or more of silk, not braided)

- 4202.22.81 (handbags with or without shoulder strap or without handle, with outer surface of manmade fiber materials)

- 4202.22.89 (handbags with or without shoulder strap or without handle, with outer surface of textile materials, not elsewhere specified or included)

This tariff will be suspended for 180 days to allow additional time for bilateral and multilateral discussions “that could lead to a satisfactory resolution of this matter.” However, USTR has left open the possibility that the suspension period could be shortened.

To get news like this in your inbox daily, subscribe to the Sandler, Travis & Rosenberg Trade Report.

Customs & International Headlines