The GSP UPDATE Act was introduced on August 2, 2012 in the U.S. House of Representatives by Representative Ander Crenshaw (R-FL) and co-sponsored by Representative Adrian Smith (R-NE).
“Now into the summer travel season and quickly approaching the back-to-school retail selling season, now is the perfect time to extend GSP benefits to cover travel goods,” said AAFA President and CEO Kevin M. Burke.
“Whether buying luggage for the family trip or backpacks for back-to-school, American consumers will benefit from the duty savings created by this bill. At the same time, the bill will support U.S. workers employed by companies in the U.S. apparel and footwear industry who produce these product categories by enabling companies to lower prices and drive sales.”
As introduced, the GSP UPDATE Act would recognize that travel goods are no longer an “import sensitive” industry by removing the current prohibition that prevents most travel goods from being eligible for duty-benefits under GSP. Under GSP, developing countries like Cambodia, Thailand, and the Philippines, will be able to export travel products to the United States duty-free. Under the GSP UPDATE Act, China and Vietnam are not eligible to participate in the GSP program.
While making U.S. imports of travel goods potentially eligible for duty-benefits under GSP, the bill continues to protect the remaining domestic manufacturers by 1) excluding from GSP eligibility certain specific types of travel goods still made in the United States and 2) requiring the U.S. government to do a review, and request public comment, before implementing any duty-benefits for travel goods under GSP.
Duties on the lowest-cost travel good can be as high as 17.6 percent. Today, 99 percent of travel goods sold in the United Sates are imported, meaning that these duties amount to an unavoidable, hidden, and regressive tax on American consumers.
American Apparel & Footwear Association (AAFA)