House Ways and Means Leaders Reintroduce MTB, No Retroactive Provision

This MTB does not appear to apply retroactively to the period between expiration of the duty suspensions last year and the signing of the bill into law. A retroactive provision is something similar bills have done in the past following an expiration of the duty suspensions. The House and Ways and Means Committee did not return a request for comment about retroactivity.

“The MTB is critical to helping domestic manufacturers here at home,” said House Ways and Means Chairman Dave Camp, R-Mich, in the press release (here). “Ensuring that our producers have access to materials that are needed to manufacture products they sell in the global marketplace makes our U.S.-based manufacturing sector more competitive. The bill has broad support, and through the transparent, bipartisan, and bicameral process, including a public comment period, controversial provisions have been identified and eliminated." HR-2708 is (here).

Fellow bill sponsor Trade Subcommittee Chairman Devin Nunes, R-Calif, also celebrated the legislation and urged the Senate to move the bill. “By temporarily suspending duties on manufacturing inputs, this bill makes U.S. manufacturers more competitive and creates U.S. jobs," he said. "The legislation essentially cuts taxes on imported goods that are not produced in America, thus removing an unnecessary cost to U.S. businesses and consumers." Ways and Means Ranking Member Sander Levin, D-Mich., and Trade Subcommittee Ranking Member Charles Rangel, D-N.Y. were also co-sponsors.

The failure to pass a new MTB last year meant the expiration of a significant number of HTS 9902 tariff numbers, which temporarily provide duty-free or reduced duty treatment to certain products (see 13010207) . Most of the temporary duty-free or reduced duty treatment provided for in HTS 9902 are for chemical products. However, other types of items, such as textiles, footwear, food, consumer-related products, etc. also receive duty-free or low duty treatment under Heading 9902. The Senate still needs to move on an MTB, though action has been hampered by disagreement over whether such bills violate a Republican prohibition on earmarks (see 13062815). Senate Finance Committee members Rob Portman, R-Ohio, and Claire McCaskill, D-Mo. introduced legislation earlier this year that would revamp the MTB process (see 13042404).

The Footwear Distributors and Retailers of America (FDRA) is optimistic for the legislation's future, the group said in an emailed press release. "I don't think Chairman Camp and Ranking Member Levin would have introduced it if the felt it wouldn’t have a good shot at passing,” said FDRA President Matt Priest. The group continues to push for footwear-related duty suspensions that the Obama administration previously objected to, it said. "FDRA has been working behind the scenes to ensure all 40 miscellaneous tariffs related to footwear get high consideration and I think we are making good strides. We will continue to fight for these additions and look forward to helping get this passed.”

Other trade groups heralded the reintroduction of the MTB as an important step for industry. "Manufacturers have been operating without an MTB for nearly 200 days, which has meant higher costs and, in some cases, a reduction in employees’ hours and even layoffs," said the National Association of Manufacturers in a press release (here). "Without the MTB, production costs will increase substantially, damaging our nation’s competitiveness." The Society of Chemical Manufacturers and Affiliates also voiced approval (here).