The International Trade Commission has released a report on the effects on the U.S. economy of the duty suspensions and reductions under the most recent miscellaneous tariff bill, which took effect Oct. 13, 2018, and will expire Dec. 31, 2020. This report also includes recommendations from interested parties on those domestic industry sectors that might benefit from permanent duty suspensions or reductions, with a particular focus on inequities created by tariff inversions.
(The ITC is once again accepting MTB petitions through Dec. 10. For more information, please contact trade consultant David Olave at (202) 730-4960.)
The ITC notes that the report only examines the effects of the MTB during the first four to five months after it was enacted. Among the report’s main findings are the following.
- Between November 2018 and May 2019, the MTB saved importers $179 million in duties on imports of $5.4 billion.
- As a result of the MTB, nearly a quarter of manufacturers responding to an ITC survey reported a decrease in production costs, and between one-quarter and one-third of respondents expected future increases in sales volumes, customers, and investment in new product development.
- For all of the HTSUS 9902 headings that provide duty suspensions and reductions under the MTB, prices declined by 3.9 percent on average.
- As of March 2019, more than 90 percent of responding firms imported or planned to import goods under the HTSUS 9902 headings and about one-third of those had increased or planned to increase imports.
- However, many respondents said they had not had enough time to take full advantage of the duty suspensions and reductions, and some reported that section 301 tariffs on products of China have lessened the positive impacts of the MTB duty relief.
- Nearly two-thirds of the MTB’s provisions were recommended for permanent duty suspensions and reductions, 10 percent of which were identified as having a tariff inversion (i.e., where the tariff rate on an imported input is higher than that on the related finished product).
Copyright © 2021 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.