The Trump administration has postponed the levying of 10% tariffs on List 4 goods covering $300 billion in imports from China until December 15th. The initial date of September 1st was postponed after reports of a phone call with Beijing.
A new round of trade talks will be held in September after this month’s talks did not result in a trade deal.
There is still time to lower your import risk, if you would like solutions to lowering the duties you need to pay, contact experienced trade attorney David Hsu at 832-896-6288 or by email at email@example.com, firstname.lastname@example.org.
According to the Wall Street Journal, the Treasury department’s tariffs is expected to generate almost $72 billion in tariffs through June of this year. This number will likely go much higher if the “List 4” duties take effect on September 1st. On September 1st, over $300 billion in Chinese goods will be subject to a 10% tariff with a potential to increase to 25%.
Specifically, as of June 30th, the Treasury department has collected $63 billion in tariffs over the past 12 months. In contrast, prior to the trade war, the US only brought in $30 billion dollars.
The WSJ estimates the annual generated amount can be as high as $100 billion by the end of the year once the 10% duties are placed on over $300 billion worth of imported goods from China.
If you have any questions how the current 301 duties or proposed List 4 duties will impact you, contact experienced trade attorney David Hsu at 832-896-6288 or by email at email@example.com, firstname.lastname@example.org.
According to the Associated Press, earlier today, China threatened the US with retaliation if Trump goes through with his threat to impose sanctions on “List 4” of goods from China on September 1st.
The primary issues of disagreement between the US and China are the forced technology transfers that are required by US companies doing business in China in addition to the lack of intellectual property protections for companies doing business in China. Additionally, the US has also expressed concerns over China’s 2025.
At the current time, the US has imposed tariffs over $250 billion in Chinese imports while the China has imposed tariffs on over $110 billion in US goods. The proposed September 1st tariffs cover over $300 billion in goods – effectively covering all imports of goods from China. The US government may have an upper hand as China only imported about $160 billion in US goods – a number that highlights the unequal trade balance ($160 billion versus $550 billion).
It will be interesting to see how China retaliates, they can only threaten to impose an additional $50 billion in tariffs on US goods, only 1/6th of the what the US can impose.
According to CNBC, profits earned by China’s industrial firms fell 3.1% in June from a year earlier, according to the China’s National Bureau of Statistics.
The decrease in industrial profits is likely due to the US/China trade war and the increase in tariffs on Chinese imports. CNBC also states that economic growth in the second quarter slowed to a near 30-year low.
With the US and China set to meet on July 30th for the first time since May, both sides may be looking for an agreement to end the almost year-long trade war.
According to the AFP, earlier today, President Donald Trump warned he would deny Apple’s “exclusion request” for tariff exemptions on device components imported from China.
Specifically, President Donald Trump wrote on Twitter:
“Apple will not be given Tariff wavers, or relief, for Mac Pro parts that are made in China. Make them in the USA, no Tariffs!”
Trump’s message on Twitter is in response to Apple’s filing of an “exclusion request” with the U.S. trade representative. Apple claims that some parts of the Mac Pro desktop being sold at $6,000 can only be sourced in China and therefore not be subject to 301 duties.
If your imported goods from China are subject to the current “List 3” duties and you would like to file an exemption, contact experienced trade attorney David Hsu at email@example.com, firstname.lastname@example.org or by phone/text at: 832-896-6288.
A Bloomberg article highlights one of the winners in Trump’s trade war with China – that being Vietnamese furniture manufacturers.
With imports of Chinese furniture subject to a 25% duty in addition to any applicable anti-dumping or countervailing duties, furniture companies in Vietnam are cashing in as the tariff-free alternative to Chinese manufacturing.
The Bloomberg article quotes, the CEO of Xuan Hoa Vietnam Joint Stock Co., a furniture company that has seen a boom in international visitors – including Ikea. Xuan Hoa is a long time Ikea manufacturer (past 17 years) and their ability to produce cheaper than China is only increasing under the trade war.
In addition to not being subject to 301 duties or AD/CVD duties, the Bloomberg article cites labor costs half of what they are in China and lower electricity costs as it is subsidized by the government. Vietnam’s shared border with China also allows for the ease of materials and components.
If you are a furniture importer from China and want to learn how to save on import duties, contact trade and customs attorney by mobile/text at 832-896-6288 or by email at email@example.com or firstname.lastname@example.org.
While we frequently hear “tariff” and “China” in the same sentence, we will likely now start hearing “tariff” and “Mexico” more frequently as the Trump administration has placed near tariffs on imports of fresh tomatoes from Mexico.
A little background – in 1996 the US did not pursue tariffs on Mexican tomAatoes based off assurances from Mexican tomato growers would not sell their tomatoes at articially lower prices. However, last year Florida tomato growers requested the Trump administration to investigate whether Mexican tomatoes were being sold at articially low prices. In February 2019, the Trump administration issued a notice they would withdraw from the 1996 agreement on May 7th if a new deal could not be reached. Since no agreement was reached, Mexican tomatoes are now subject to a 17.5% tariff. If a subsequent investigation finds no unfair pricing, then any tariffs paid will be refunded.
Questions about the tomato tariffs, call/text David Hsu at 832.896.6288 or email at email@example.com.
Earlier in February of this year, the Department of Justice Office of Public Affairs released news of a settlement by Home Furnishings Resource Group Inc. agreement to pay $500,000 in settlement for False Claims Act allegations.
Home Furnishings Resource Group Inc. (HFRG) agreed to pay the $500,000 after they were alleged to have violated the False Claims Act on customs declarations in order to avoid paying antidumping duties (ADD) on “wooden bedroom furniture” imported from China.
Customs alleged the Hermitage, Tennessee company did not pay antidumping duties from 2009 to 2014 by misclassifying furniture as “non-bedroom” on import documents. By misclassifying as “non-bedroom”, HFRG did not pay the required ADD on wooden-bedroom furniture.
Why do we have antidumping duties?
Antidumping duties protect American manufacturers against foreign companies who make the same goods at a price below cost and “dump” the products into the US. The Department of Commerce (Commerce) is responsible for assessing whether goods are dumped into the US – and if so, assign an ADD amount to those imported goods.
The addition of a duty for these goods is to protect U.S. businesses and “level the playing field for domestic companies”.
The Department of Homeland Security’s Customs and Border Protection (CBP) then collects these duties – wooden bedroom furntiure’s ADD rate was 216% and non-bedroom furniture was not subject to any duty.
How was HFRG caught?
University Loft Company, a competitor of HFRG, used the whistleblower provision of the False Claims Act, permitting private parties to sue on behalf of the US against those who falsely claim federal funds or, as in this case, who avoid paying funds owed to the government. The act also allows the whistleblower to receive a share of any funds recovered. University Loft Company will receive approximately $75,000.
Do you know anyone violating the False Claims Act?
If you believe an importer has been misclassifying goods to avoid payment of duties, contact David Hsu at 832-896-6288 or by email at firstname.lastname@example.org.