The Covid19 pandemic has forced business owners to play hopscotch around safety regulations. One such challenge was when Section 301 of the Trade Act of 1974 was enacted in what we all know as the US China Trade War. The tapered tariffs that were put on imported Chinese goods were enough for business owners to deal with, but then came the pandemic. Many goods that we needed to help pull through the health crisis were listed on the tariff list, however, they were excluded and allowed to pass without additional costs. This was a boon to businesses who needed to quickly import for the sake of keeping doors open, but also helped many businesses shift gears and throw their hat in the ring to help aid in the covid crisis.
The tariff exclusions on these goods were set to expire on September 30th.
That would mean all these products that were being imported to help with the pandemic, were about to get slapped with massive tariffs and fees that had been waived for months.
It seems, however, the US Trade Representative needs more time to decide exactly what products are going to be excluded and for how long. There are 99 products that are excluded from the Section 301 tariffs. These products range from iron, aluminum, and other metal compounds to hardware pieces and rubber parts for larger machines and equipment. On August 27th an overwhelming number of recommendations were submitted to the USTR, when the department reached out for public comment on which of the 99 products should be excluded from the tariff list for an additional six months. This pushed the September 30th deadline to November 14th, 2021 giving businesses an additional 45 days of stress free importing.
What this means is business owners who were biting their nails in anticipation of this deadline, now get to take a sigh of relief, knowing the USTR is listening to their concerns, reading their comments, and making decisions based on their feedback.
Helping businesses navigate difficult times like these is one of the many hats that the US Trade Representative wears.
There are other businesses that are tired of dodging government fickleness and regulatory indecisiveness. Many of these companies use Foreign Trade Zones to shelter products from much of the custom costs and taxes that are imposed on imports, and even allow them to hold goods while agencies like the US Trade Representative, decide on how to move forward with US policy.
FTZ’s are used for a number of benefits, including:
- Duty exemption, deferral, or reduction
- Merchandise processing fee reduction
- Quota avoidance Efficient logistics
- Cash flow benefits
With the steering wheel back in your hands, you can choose how and when these costs are dealt with and protect your business from unexpected trade war fallout.
When it comes to operating and managing Foreign Trade Zones, ITC Diligence Inc. has the experience, team, and knowledge to support your business and help directly impact your bottom line. There are many directions that this trade war can go and many of them will require businesses today to modify, redirect, or reevaluate the way they do perform their daily operations. Making Foreign Trade Zones a part of your fundamental business resources means you have a method to keep moving forward, when the government hits the brakes.