House Bill Introduced to Remove GSP Eligibility for Certain Sleeping Bags
On July 29, 2010, Representative Aderholt (R) introduced the “Save U.S. Manufacturing and Jobs Act” (H.R. 5940), which would remove certain sleeping bags from duty-free eligibility under the General System of Preferences.
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Non-Down Sleeping Bags in HTS 9404.30.80 Would be Affected
Under the bill, no product classifiable under HTS Subheading 9404.30.80 -- for sleeping bags, not containing 20% or more by weight of feathers and/or down, which are referred to as non-down sleeping bags -- would be eligible for duty-free or other preferential treatment under GSP.
This withdrawal of GSP benefits would apply to goods entered, or withdrawn from warehouse for consumption, on or after the 15th day after enactment.
Bill Targets Bags Made with Chinese Components
According to the bill’s “Congressional Findings” section, sleeping bags made in beneficiary countries under the GSP program are made almost entirely with Chinese components and then assembled in “free zones” so that no duty is paid on the Chinese fabrics and other raw materials entering those GSP beneficiary countries. However, U.S. manufacturers must pay duty on any imported components, creating an advantage for foreign manufacturers.
(The bill’s sponsor, Representative Aderholt, states that this bill would end “unfair advantages,” slow the loss of U.S. textile jobs, and close a loophole in the GSP system, as he believes no textiles are meant to be covered under GSP.)
Petition to Remove GSP Benefits for These Bags Recently Denied
In July 2010, the Office of the U.S. Trade Representative denied a petition to remove GSP eligibility for sleeping bags classified under HTS 9404.30.80 as part of its 2009 annual GSP review. In addition, as part of this review, the International Trade Commission released an April 2010 report on the economic effect of possibly removing these sleeping bags from GSP, which found that imports of the subject sleeping bags declined by 35% during 2005-2009.
(See ITT’s Online Archives or 07/02/10 and 04/21/10 news, 10070221 and 10042131, for BP summaries.)
Rep. Aderholt press release, dated 07/30/10, available here.