April ’22 at-a-glance … taxes, tariffs & trade

USTR reinstates some Section 301 product exclusions; NAFEM advocates for transparent review of all Section 301 tariffs

More than 350 of the 549 expired Section 301 product tariff exclusions on imports from China were reinstated by the United States Trade Representative (USTR). The reinstated exclusions apply as of Oct. 12, 2021, and extend through Dec. 31. A searchable, work sheet of reinstated exclusions is available on the Member Dashboard.

NAFEM and other members of Americans for Free Trade (AFT) also wrote to USTR Katherine Tai asking for a “comprehensive economic assessment of the Section 301 tariffs’ impact on American businesses, workers, farmers and consumers.” List 1 of the tariffs is set to expire in July unless USTR receives a petition for continuation, which AFT expects to occur. In its letter, AFT asked Tai to not only review List 1 but all four tariff lists to determine whether the tariffs represent the best path forward.

Section 301 tariff refund lawsuit remanded back to USTR

A U.S. Court of International Trade (CIT) three-judge panel remanded back to the USTR the Section 301 tariff-refund case. The Court found that USTR has authority to implement Lists 3 and 4A of the Section 301 tariffs but failed to address and consider public comments and adequately explain its rationale. The tariffs remain in place while USTR prepares its response.

U.S./U.K. agree on quota for steel imports

Similar to agreements with the EU and Japan, the U.S. has agreed to a tariff rate quota (TRQ) for steel imports from the U.K. About 551,000 tons of steel can now be imported duty free. After this volume is reached, a 25 percent tariff will apply. The volume will be adjusted annually based on U.S. steel demand data from the World Steel Association. The agreement also requires independent audits of any U.K-based steel producers with Chinese ownership to determine the degree of influence the Chinese government has on these companies. The agreement, which takes effect June 1, also removes the U.K.’s retaliatory tariffs on U.S. goods including whiskey and motorcycles.

NAFEM recommends improvements to Section 232 tariffs exclusion process

In a letter to Secretary of Commerce Gina Raimondo, NAFEM and other members of the Coalition of American Metal Manufacturers and Users (CAMMU) shared their believe that “the very nature of the exclusion process discriminates and disadvantages America’s small- and medium-sized manufacturers who often lack the purchasing power to buy ‘mill-direct.’” CAMMU went on to share suggestions for reducing rejected filings, the length of time for processing exclusion requests and a number of other process improvements. In a similar letter to the Department of Commerce’s Bureau of Industry and Security (BIS), NAFEM expressed its continued opposition to the Section 232 tariffs on imported steel and aluminum. NAFEM also proposed further changes to the objection form and required information to increase transparency of the exclusion process, establishing a request process for new or amended General Approved Exclusions, and allowing trade associations to submit exclusion requests on behalf of their members.

Indo-Pacific Economic Framework analysis underway

Work continues on the U.S. Indo-Pacific Economic Framework President Biden announced to deepen economic relations with the region in Oct. 2021. The Secretary of Commerce and USTR are leading work on the framework that will address fair and resilient trade; supply chain resilience; infrastructure, clean energy and decarbonization; and tax and anti-corruption. The presidential remit also includes finding ways to collaborate on global economic challenges.