301 TARIFFS | The Continuous Rise
The 301 “China” Tariffs have been a huge source of controversy since President Trump imposed the larger tariffs of those goods being imported from China. So much so, that in two years the trade-weighted average tariff has tripled for the goods involved. In the process, multiple lists were published each indicating a large section of those goods that were included in rate additions from 7.5% up to 25% of additional administration-imposed tariffs because of an investigation that the United States was engaging in discriminatory practices that harm domestic trade. This means that not only are importers paying their original import tariff, but also adding much higher and heavier tariffs on top of those already established.
While the 301 Tariffs are being cited as one of the main drivers of the continuing rise in inflation - the highest in 40 years – President Biden has chosen to retain Section 301 Tariffs. This resulted in the creation of four lists affecting imports ranging from turbines and electronic integrated circuits to bicycles and televisions.
Based on Section 301 of the Trade Act of 1974, the Trump administration-imposed tariffs on imports coming from China – ranging from 7.5 to 25% between 2018 and 2019. Fast-forward to today, cabinet members have expressed conflicting views on the said tariffs and are still debating on them. While the administration has a good opportunity to eliminate these tariffs, it is the country’s most effective tool in maintaining negotiating leverage with China.
This is where Duty Drawback plays a very important role. The perfect avenue to get the refund of duties, taxes, and fees that were paid upon import of any merchandise originating from China. The principle behind duty drawback is to encourage importation into commerce and the continuation through exportation by refunding the customs incurred duties paid by the exporter on imported items.
On a general basis, duties can be refunded in a couple of different circumstances. Those would be including actual duties incurred and paid on importation, Harbor Maintenance Fees, Merchandise Processing Fees, or anything incurred through destruction of the goods.
Join our 301 TARIFFS webinar
September 01, Thursday
11:00-12:00 pm (MDT) | 1:00-2:00 pm (EDT)
To show an example of just how effective a drawback pursuit is, in fact, many importers were not even aware of a program such as duty drawback and therefore had to close their doors rather than continue to pay such high rates. While many businesses were impacted, many others chose to draw the line and proceed with a duty drawback program through CITTA Brokerage Co. With that said, one Fortune 100 client stated “CBC was our only source of revenue during four months of COVID shutdown” throughout their company of which spans multiple countries.
If you are a company that regularly imports from China, Exclusion Requests are an avenue that you would absolutely want to investigate further into and have a licensed Broker complete on your behalf. CITTA Brokerage also has the ability to do so with incredible success for our clients.
CITTA Brokerage Co. | 2225 Washington Blvd., Suite 375 Ogden, UT 84401
Email: info@cittabrokerage.com | Tel: 801-479-7873
Comments