Bipartisan Letter Asks Tai to Open Section 301 Exclusion Applications to All
Almost a third of House members are asking U.S. Trade Representative Katherine Tai to reopen exclusion applications to all importers of Chinese goods subject to Section 301 tariffs. Roughly $250 billion worth of Chinese imports annually are subject to an additional 25% tariff under Section 301; another $112 billion worth of imports are subject to an additional 7.5% tariff.
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The Jan. 20 letter, led by pro-trade Democratic Reps. Ron Kind of Wisconsin and Suzan DelBene of Washington and Republican Reps. Darin Lahood of Illinois and Rep. Jackie Walorski of Indiana, said the expansion would "support American workers, businesses, and our economic recovery." They thanked her for allowing some companies with expired exclusions to reapply, but noted it only covers 1% of the original applications for reconsideration. "Expanding this process to more products is especially important given the significant challenges with transparency and procedure in the original exclusion process, as the Government Accountability Office found in its July 2021 report to Congress." That report said there were 31,664 requests for exclusions (see 2107280052), and that at most, only 10% of imports covered by the tariffs received exclusions. Overall, about $71 billion of imports avoided the tariffs, GAO estimated.
The signatories include a wide spectrum of ideology, from Democratic Rep. Dan Kildee, a trade skeptic from Flint, Mich., to free-traders who are Republican leaders on the Ways and Means Committee -- new Trade Subcommittee ranking member Rep. Adrian Smith of Nebraska, former Trade Subcommittee ranking member Rep. Vern Buchanan of Florida, and Ways and Means' top Republican, Rep. Kevin Brady of Texas. It also included many of the "front-line" Democrats, whose seats in swing districts are most vulnerable in the mid-term elections. The letter said that small and medium-sized businesses have been less able to absorb the higher tariffs, and that "Section 301 tariffs have also harmed American families and consumers by raising prices on a wide range of consumer products."
They told the USTR that the retroactivity of exclusions should go much further than Oct. 12, 2021 (see 2110120055). "There is little reason to charge additional tariffs on covered products during the months when no exclusion process existed," they wrote.The members said the broader exclusion application process should include "expedited procedures for those who had been granted exclusions in the past."
“Our economic recovery must include a pro-growth trade policy that will uplift American workers and support our global competitiveness," DelBene said in the press release.