Background

A new 25 percent tariff on soap, cosmetics, and handbags from France is set to take effect Jan. 6.

In 2020 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 has determined to impose a 25 percent additional tariff on the following 21 tariff subheadings when imported from France.

- 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 suntan 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)

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

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