End of Year Import Duty Increases

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There are several programs expiring at the end of the year that may impact the duty paid on your imports, including many Section 301 U.S.-China tariffs and two U.S. trade programs.

Section 301 Exclusion Extensions Expiring
As part of the Section 301 US-China Trade War, the U.S. Trade Representative (USTR) has granted over 2,200 product specific exclusions across all four Section 301 Lists. As those exclusions expired, USTR granted extensions to more than 550 products – many of which are set to expire at the end of this year.

Six exclusions from List 1 are set to expire on December 28, while 531 exclusions from Lists 1-4 are set to expire on December 31. Once expired, entries of those goods will be subject to the applicable additional Section 301 duties.

Generalized System of Preference (GSP) Expiring
The Generalized System of Preference (GSP), a U.S. trade preference program that provides duty-free treatment to thousands of products imported from developing countries, is set to expire at the end of this year. Since its inception in 1975, Congress has renewed the GSP on multiple occasions. However, the last renewal expired on April 22, 2018, and was not renewed retroactively until January 1, 2018, leading to a four-month program lapse.

The GSP is again set to expire on December 31, 2020, and it again appears Congress will not renew the program in time. As with previous GSP renewal lapses, importers will be required to pay the Normal Trade Relations (NTR) duties effective January 1, 2021. Once the GSP is renewed, it is expected that importers will be able to seek refunds on duties paid during the lapse. CBP is expected to provide instructions for the trade regarding filing requirements after January 1, 2021.

Miscellaneous Tariff Bill (MTB) Expiring
The Miscellaneous Tariff Bill (MTB) is a law that temporarily reduces or suspends the import tariffs paid on particular products imported into the United States. The 2018 MTB reduced or eliminated tariffs on approximately 1,700 products up through December 31, 2020. However, due to multiple objections to petitions submitted from the trade, Congress is unlikely to renew the MTB before it expires. Importers will be subject to full duty on January 1, 2021, and, even if MTB is renewed, it is unlikely importers will be able to obtain refunds of duties paid during the lapse.

Trans-Border will continue to monitor this developing situation and provide updates as needed. If you have any questions, please reach out to at info@tbgfs.com or (800) 493-9444.

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