US businesses big and small made a fresh push for the Biden administration to remove Trump-era tariffs on Chinese goods as the government considers a formal extension on the hundreds of billions of dollars in levies.
(Bloomberg) — US businesses big and small made a fresh push for the Biden administration to remove Trump-era tariffs on Chinese goods as the government considers a formal extension on the hundreds of billions of dollars in levies.
The Chamber of Commerce called for tariff relief, while the Information Technology Industry Council sought a complete rollback of the duties, according to submissions during the Office of the US Trade Representative’s public comment period, which ended Tuesday. Many small businesses, which were among the almost 1,500 entities providing feedback, said the duties had pushed up their input costs.
The tariffs on Chinese merchandise imports are a holdover from former President Donald Trump’s aggressive actions against Beijing, after an investigation concluded China stole intellectual property from American companies and forced them to transfer technology.
There’s little indication that the White House is inclined to significantly roll back the tariffs: President Joe Biden has kept them in place as leverage against what the US sees as its key strategic and economic rival, and amid concerns that repealing them would be politically risky.
The tariffs are among the broader trade tools Washington is using to counter Beijing that include export controls to limit China’s access to cutting-edge technology, and subsidies to help boost American companies.
Biden has been holding back on a decision to scrap duties on the Chinese imports, which span industrial inputs — such as microchips and chemicals — to consumer merchandise including apparel and furniture.
His administration in November asked for comments on the effectiveness of the duties as part of its broader analysis of the tariffs, which started in 2018. They were due to expire in 2022 — four years after they were first imposed — but the request to the USTR to analyze their effectiveness through a so-called review of necessity allowed them to stay in place.
The estimated duties assessed since the tariffs started in 2018 through Jan. 18 total $167.8 billion, according to data collected by US Customs and Border Protection.
‘Undermine Competitiveness’
In its submission, the US Chamber of Commerce — the biggest business lobbying group and generally an opponent of managed trade — maintained its stance that untargeted, punitive tariffs “undermine US competitiveness and impose undue economic hardships on US businesses, workers, and families.”
It urged the administration to issue a new package of tariff relief for non-strategic goods and start a fresh, expedited process to consider petitions from business for other tariff exclusions.
The US has provided a reprieve on tariffs for hundreds of product lines of goods from China as the Biden administration reviews the need for the duties, with the most recent round of exclusions announced in December.
‘Significant Harm’
The Information Technology Industry Council — whose members include top chipmakers Intel Corp., Samsung Electronics Co., and Taiwan Semiconductor Manufacturing Co. as well as Apple Inc. and Amazon.com Inc. — said the tariffs have failed to counteract the Chinese government’s unfair trade policies and practices, and called for their complete rollback.
While the duties were originally intended to level the playing field for American businesses, “there is no evidence that the tariffs have met the stated objectives,” the Washington-based ITI said. Instead, they have “caused significant harm to our industry and contributed toward rising costs.”
Small-Business Pain
Owners of small businesses also contributed comments. While some advocated for the tariffs to remain, many of them said they made sourcing key inputs pricier.
“I’ve been trying to absorb the additional cost of our materials, but it’s getting more and more difficult,” said Linda Grossman, the co-owner of Abington, Massachusetts-based Chair Man and the Tea Lady, which reweaves furniture pieces.
Noting that prices of cane have jumped over the past few years due to a shortage of labor, Grossman wrote that she does “not understand how the US citizen paying this tariff punishes the Chinese.”
The tariffs have made it “more difficult for our company to provide an essential and affordable protein to US consumers during a time of high food inflation,” wrote David Wier, the executive vice president of Fishin’ Co., which sources tilapia from China. The Munhall, Pennsylvania-based operation employs 65 people.
“Since seafood has nothing to do with the underlying China violations and has no prospect of benefiting from remedies addressing them,” Wier said, consumers shouldn’t absorb “unnecessary and unfair tariff barriers.”
Review Timeline
Asked on Thursday when the review process for the so-called section 301 tariffs will conclude, US Trade Representative Katherine Tai declined to provide a timeline.
“We are going to bring a disciplined approach to the feedback that our public has provided us,” she said in an interview with David Westin on Bloomberg Television Thursday. “There is no more important aspect of our work, especially in the management of this relationship.”
In May, USTR General Counsel Greta Peisch said the review “would likely take months.”
(Updates with estimated assessed duties in eighth paragraph.)
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.