Summer tariff updates

There’s a lot of news circulating about upcoming new tariffs, expiring tariffs and possible tariffs that might impact U.S. importers, especially if you’re bringing in cargo from the E.U. or China. Tariffs on imports from the E.U. stem from both the Civil Aviation Dispute and upcoming Digital Services Taxes, which have so far only been levied toward France. Chinese imports under Section 301 duties are currently being reviewed to determine which exclusions will be extended and which will expire in August. We’ve compiled a handy overview of what we’re looking at on the tariff front this season.

The Civil Aviation Dispute is an ongoing battle between the U.S. and E.U. relating to each nation providing unfair subsidies to Boeing and Airbus, respectively. In a simplistic view, both nations gave unfair subsidies and both nations are trying to recieve approval from the World Trade Organization to levy duties against the other to recoup losses on those subsidies. While only the U.S. has recieved approval, the WTO decision on the U.S. / Boeing tariffs will be coming, though delayed due to coronavirus closures. Currently the US has implemented 25% tariffs on imports but the USTR is reviewing the current products, considering adding more and looking into initially reviewed products that weren’t taxed. Comments on these tariffs can be made at the online portal.

On top of the issues with the Civil Aviation Dispute, the U.S. has imposed at 25% tariff on imports from France as a retaliation for the 3% Digital Services Tax they placed on technology companies that aren’t based in France but serve residents of France, including Google, Amazon, and Facebook. While France isn’t the only nation to suggest these tariffs, they’re the only one so far that’s implemented and received the retaliated higher designation by the USTR. The investigation by the USTR suggested up to a 100% tax on a list of products worth $2.4 billion but only $1.3 billion was hit with wine and cheeses left off the initial list. Cosmetics, soap, and handbags weren’t so lucky, but considering the implementation is postponed until January 1, 2021 both parties will have a 180 negotiation period to work this out.

On July 9th, the USTR let tariffs on almost 100 products listed on the Chinese Section 301 list expire with only 12 products receiving an extension. More cargo is due to see exclusions expire in August, including every exclusion on the List 3 301 duties if no extension is applied.

If you’re concerned that your cargo could be facing tariff issues and you’d like to discuss ways you can comment to the USTR or need to investigate some fresh sourcing ideas in your supply chain, reach out to your Nelson International representative to take advantage of our shipping solutions!