2019 is shaping up to be another active year in terms of changes to the Harmonized Tariff Schedule. Like last year, a series of revisions were necessary in the first half of the year to implement Section 301 exemptions and an increase for $200 billion worth of the China tariffs from 10 percent to 25 percent. Other major changes are related to the Generalized System of Preferences, and in particular the removal of India and Turkey from the program. In all, seven revisions were issued prior to the mid-year Revision 8, as follows:
The International Trade Commission on July 1 posted Revision 8 to the 2019 Harmonized Tariff Schedule. The semiannual update to the HTS implements the fourth and final round of tariff cuts under the expanded World Trade Organization Information Technology Agreement. It also extensively reorganizes 10-digit tariff subheadings covering aluminum products, and adds tariff provisions for aerial work platform trucks, frozen berry mixes, diamond grinding wheels, storage lockers and certain electric motorcycles.
The rapid changes in trade policy have elevated the need for adroit trade compliance management at international companies that hadn't previously been so concerned with customs duties, said two compliance professionals who spoke at the American Association of Exporters and Importers Annual Conference in Washington on June 28. "It's been an overall breaking down walls of communication" among the various groups at the company who "historically" didn't interact very often, said Antoinette Montoya, corporate export-import compliance manager at Bechtel Corporation. Now, though, "we've had a lot of really good strategic relationships built out of this," she said. Whatever happens with subsequent administrations, those relationships will "really help us in the long run," Montoya said.
CBP's Office of Regulations and Rulings is facing a massive increase in ruling requests involving products from China, in addition to its need to weigh in on exclusion requests, CBP Assistant Commissioner Brenda Smith said June 28 at the American Association of Exporters and Importers Annual Conference in Washington. The trade remedy exclusion requests are reviewed by OR&R "because of the tariff classification inherent in the application and then in the final determination," she said. Exclusion requests for the Section 232 tariffs on steel and aluminum are now at about 80,000, well above the 10,000 that were expected when first announced, she said. That's not counting the exclusion request processes now available for the first three tranches of Section 301 tariffs on goods from China, she said.
The Office of the U.S. Trade Representative will open its new portal on June 30 at noon for exclusion requests for the third tranche of Section 301 tariffs (see 1906200002), as announced in a June 24 notice. The agency also posted a set of Frequently Asked Questions about the exclusion process, supplementing the recently added site meant to help importers navigate the Section 301 tariff process (see 1906190002).
CBP issued the following releases on commercial trade and related matters:
While the reasons that Section 301 tariff exclusions were granted are murky to trade lawyers, in general, more information is better when submitting requests, trade lawyers said during a panel at the American Association of Exporters and Importers Annual Conference June 28. Pictures of your product, emails from domestic companies saying they can't provide the quantity you're looking for, and the number of U.S. jobs that are imperiled if you have to pay 25 percent more for this product are all good pieces of information to provide, they said.
CBP has assessed about $27.8 billion in duties under the major trade remedies started during the Trump administration as of June 19, according to CBP's trade statistics page. That includes $19.3 billion in duties from the Section 301 tariffs on goods from China. The first tranche of Section 301 tariffs took effect on July 6, 2018 (see 1807050033); the second took effect on Aug. 23, 2018 (see 1808070046); and the third, on Sept. 24, 2018 (see 1809240015). CBP also has assessed about $5.8 billion under the Section 232 tariffs on steel and $1.8 billion under tariffs on aluminum. The Section 201 trade remedies on washing machines and solar cells (see 1801230052), imposed Jan. 23, 2018, account for $857.7 million in assessed tariffs.
Rep. Stephanie Murphy, D-Fla., introduced a bill, the Reclaiming Congressional Trade Authority Act of 2019, that would require that any tariffs implemented on national security grounds -- whether through Section 232 or another mechanism, such as the national emergency on immigration -- be approved by Congress. The bill, introduced June 25, would allow tariffs to be in place for 120 days without congressional approval. It has a Senate companion bill, S. 899, introduced by Sen. Tom Carper, D-Del., and Sen. Tim Kaine, D-Va.
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