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U.S. additional tariffs on imports from China to increase to 25%

Additional tariffs on imports from China to increase

The Office of the U.S. Trade Representative (USTR) today released for publication in the Federal Register a “notice of modification of action” pursuant to the “Section 301” investigation by increasing the rate of additional customs duty from 10% to 25% for certain products of China covered by a September 2018 action. The 25% additional customs duty or tariff will be effective May 10, 2019.

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The USTR notice [PDF 255 KB] also notes that a process is being established under which interested persons may request that particular imported products that are classified within a tariff subheading covered by the September 2018 action may be excluded from the additional customs duty. The USTR will publish a separate notice describing the product exclusion process, including the procedures for submitting exclusion requests, and an opportunity for interested persons to submit oppositions to a request.

An annex to the USTR notice amends the Harmonized Tariff Schedule of the United States (HTSUS) to provide that the rate of additional duties for the September 2018 action will increase to 25% on May 10, 2019. The 25% rate will be effective with respect to goods: (1) entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on May 10, 2019, and (2) exported to the United States on or after May 10, 2019.

The Section 301 additional customs duty rate applies to products of China, and the customs duties are based on the country of origin, not country of export.

Background

The USTR in September 2018 provided for imposition of additional import duties at an initial rate of 10% on over 5,700 full and partial eight-digit subheadings of the HTSUS on goods imported from China pursuant to the Section 301 investigation. The rate of additional duty was set to increase to 25% on January 1, 2019, but that effective date was postponed to March 2, 2019. The president on February 24, 2019, directed a further delay in the duty increase.


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For more information on this topic or to learn more about KPMG’s Trade & Customs Services, contact:

Doug Zuvich
Partner and Global Practice Leader
T: 312-665-1022
E: dzuvich@kpmg.com

John L. McLoughlin
Principal and East Coast Leader
T: 267-256-2614
E: jlmcloughlin@kpmg.com

Andy Siciliano
Partner and National Practice Leader
T: 631-425-6057
E: asiciliano@kpmg.com

Luis (Lou) Abad
Principal, Washington National Tax
T: 212-954-3094
E: labad@kpmg.com

Irina Vaysfeld
Principal
T: 212-872-2973
E: ivaysfeld@kpmg.com

Amie Ahanchian
Managing Director
T: 202-533-3247
E: aahanchian@kpmg.com

Robert Waldrop
Principal
T: 212-954-8117
E: rwaldrop@kpmg.com

Gisele Belotto
Managing Director
T: 305-913-2779
E: gbelotto@kpmg.com

Christopher Young
Principal
T: 312-665-3229
E: christopheryoung@kpmg.com

Andy Doornaert
Managing Director
T: 313-230-3080
E: adoornaert@kpmg.com

George Zaharatos
Principal
T: 404-222-3292
E: gzaharatos@kpmg.com

Jessica Libby
Managing Director
T: 612-305-5533
E: jlibby@kpmg.com

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