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NCTO seeks approval for collection of China 301 duties

19
Apr '21
Pic: Shutterstock
Pic: Shutterstock
The National Council of Textile Organizations (NCTO) of the US has requested the Office of Management and Budget (OMB) to reconsider and approve a proposal to direct US Customs and Border Protection (CBP) to collect Section 301 penalty duties on billions of dollars of Chinese goods currently shipped duty-free under Section 321 de minimis waivers.

In a letter to the acting director of the OMB, Robert Fairweather on April 13, the NTCO president and CEO, Kim Glas wrote: “There has been an exponential growth of shipments to the US in recent years that qualify for Section 321 duty-free treatment. US manufacturers of textiles, apparel and other consumer goods that routinely sell for less than the $800 de minimis threshold increasingly find their markets and workforce threatened by this tariff avoidance scheme.”

The letter detailed how the current Section 321 provision is now being coupled with e-commerce to provide billions in duty avoidance on these imported products, including:

  • Increased import price pressure on domestic manufacturers of various types of consumer items that routinely sell for less than $800 such as – apparel, footwear, home furnishings, toys, consumer electronics, flatware, auto parts, etc;
  • An inability to properly identify and block the import of adulterated products posing a health and safety risk to consumers;
  • An inability to properly identify and block imports of counterfeit products that violate intellectual property laws;
  • Enhanced ability of countries like China to access the US market, despite their failure to provide reciprocal access to their markets and their persistent illegal and unfair trading practices.

Glas wrote: “Imported merchandise from China that enters under a Section 321 waiver is exempt from all normal tariffs and any penalty duties assessed under the current 301 case. This unreasonable and unnecessary duty exemption severely undermines the purpose and value of the existing Section 301 determination against China as an effort to address its longstanding predatory trade practices.”

The NCTO president felt that the Biden administration should undertake an exhaustive review of this problem to develop the policy changes needed to mitigate the damaging impact of Section 321 waivers on US workers and manufacturers. He urged the OMB and CBP to take reasonable steps, such as denying Section 321 benefits to goods covered under the existing China 301 determination [tariffs]. This would be a valuable first step toward limiting the dangerous and growing exploitation of this tariff waiver mechanism, he said.

Fibre2Fashion News Desk (SG)


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