Let’s debrief the Section 301 situation. List 1, effective July 6, 2018 places an additional duty rate of 25% on $34 billion worth of goods from China. List 2, effective August 23, 2018 places an additional duty rate of 25% on $16 billion worth of goods from China. List 3, effective September 24, 2018 places an additional 10% on $200 billion worth of goods from China, but is slated to jump to 25% on January 1, 2019. It has been announced that a possible List 4 will take effect date-to-be-determined with an additional duty rate of 25% on $267 billion worth of goods from China. This List 4 would encompass all other goods originating from China.
Want to keep more money in your pocket?
Duty Drawback is allowed on Section 301 products (but not on Section 232). Ask our team for more information if you are using Chinese components to produce items that are re-exported out of the USA.
Check out the MTB Act
On September 13, 2018, President Trump signed into law: H.R. 4318, the “Miscellaneous Tariff Bill Act of 2018,” which provides for duty suspensions and reductions for certain products entered into consumption on October 13, 2018 through December 31, 2020.
The Miscellaneous Tariff Bill (MTB) reduces or completely eliminates duty on 1,660 imported products not manufactured or available domestically. This is BIG news for manufacturers! Even if you’re a manufacturer importing from China, you can benefit!
Because several of the products that qualify for a reduced duty rate are from China, they are subject to Section 301 additional tariffs. So, although an importer may have just discovered its qualification for duty reduction, it will still need to consider the additional 25% (as of January 1, 2019) on required HTS numbers from China…. but at least the importer will still benefit since it is not required to pay the entire sum of the two duty rates had the MTB Act not passed. You can view a valid example and download a handy spreadsheet here.
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