Section 301 Exclusion Expirations
The last large group of Section 301 Exclusions is set to expire on December 31, 2020. Importers who have been experiencing relief through these extended exclusions, will once again see the additional tariffs applied to their products in 2021. There are very few exceptions of specific products which will have their exclusions extended into the new year. The vast majority of importers should plan for these additional duties to be integrated into their supply chain costs.
There has been no information given by the USTR that any additional exclusions will be extended. However, the group ‘Americans for Free Trade’ has written to the USTR asking for an automatic 6-month extension to all exclusions which are still active. They state that US businesses are still struggling due to the COVID-19 pandemic, and additional taxes at the start of the new year would hinder recovery. We will continue to monitor for a response and report any new information in our updates.
Section 301 Litigation
While it will take some time for movement in the Section 301 case which has been presented to the Court of International Trade, attorneys around the country are still encouraging importers with goods impacted by Section 301 List 4A to join the litigation. Connect with your trade attorney to discuss in more detail on how to join the litigation and ensure that you secure the highest probability of receiving a duty refund, in the event that the litigation is successful.
Section 301 duties on De Minimus Entries
Imports with a commercial invoice value under $800, known as de minimus entries, are currently exempt from duty, including additional Section 301 duties - but this exemption is now under evaluation. CBP (US Customs and Border Protection) and the trade community have both expressed concerns regarding implementation if this is overturned. A change could impact the landed cost of most low value goods and increase transit time as all shipments would be processed as a formal customs entry. There is worry that price increases and reduced speed to market for these goods would have a negative impact on US consumers, as many are used to very quick shipping times particularly on small e-commerce purchases. The proposed change is still under discussion.
For over 70 years, Laufer Group International Ltd. has been helping customers improve the way they handle their logistics. To see how we can help, or for any questions, contact Ashley Coxey, National Director of Business Development, Customs Brokerage or contact your local sales representative.