As many Section 301 product exclusions and two programs expire at the end of 2020, importers will be subject to increased duties starting in January.
Section 301 Exclusion Extensions Expire by the End of the Year
Since December 28, 2018, the U.S. Trade Representative (USTR) has granted over 2,200 product specific exclusions across the four Section 301 tariff actions taken on over $550 Billion in imports from China. As the exclusions expired, the trade was able to submit comments to request extensions of certain product exclusions. The USTR granted extensions for more than 550 products across all four tranches, most of which will expire at the end of this year. Six extended exclusions from Tranche 1 will expire December 28th and 531 extended exclusions from all four Tranches will expire December 31, 2020. Once these exclusions expire, entries of those goods will be subject to the applicable additional Section 301 duties. For more information on the Exclusions granted, see the USTR page here. Additionally, you can search the status of all exclusions on our website here.
Generalized System of Preference (GSP) Expiration
The Generalized System of Preference (GSP) is a trade preference program that allows for duty-free treatment on thousands of products imported into the U.S. from designated developing countries. Congress has reviewed and renewed the GSP multiple times since enacted in 1975; however, the last renewal expired with a lapse of almost four months. On April 22, 2018 the program was renewed retroactive to January 1, 2018 and is set to expire again on December 31, 2020. Once again, we are nearing the expiration of the GSP program, and it is looking unlikely that Congress will renew the program prior to the expiration date. As with previous lapses in GSP renewal, importers will be required to pay the Normal Trade Relations (NTR) duties effective January 1, 2021. GSP’s renewal is retroactive, so once renewed, importers are able to seek refunds of duties paid during any lapse of the GSP program authorization. CBP is expected to provide instructions for the importing community regarding filing requirements starting January 1, 2021.
Miscellaneous Tariff Bill (MTB) Expiration
The Miscellaneous Tariff Bill (MTB) is a law that temporarily reduces or suspends import duties on particular products imported into the United States. The 2018 MTB reduced or eliminated the Normal Trade Relation (NTR) tariffs on approximately 1,700 products from October 13, 2018 through December 31, 2020. Starting in January of 2020, the trade was able to submit comments related to product inclusion in the renewal of the MTB. The International Trade Commission (ITC) submitted its final report to Congress in August; however, due to multiple objections to submitted petitions, Congress is unlikely to renew the MTB before its December 31st expiration. If Congress is unable to renew the MTB, importers will be subject to full duty effective January 1, 2021. Although it is expected that the MTB will eventually be renewed, importers are not able to obtain refunds of duties paid during the lapse of the MTB authorization.
