A bipartisan group of 30 senators has called on the Trump administration to allow carve-outs for businesses affected by the $200 billion in tariffs the administration has put on Chinese imports.
“American manufacturers should have access to a tariff exemption process so they can continue to source components and materials from China, particularly where this is no alternate supplier,” the senators wrote in a letter Friday to U.S. Trade Representative Robert Lighthizer. The signatories included Sens. Roy Blunt, R-Mo., James Inhofe, R-Okla., Dianne Feinstein, D-Calif., and Bill Nelson, D-Fla., among others.
President Trump has placed tariffs on $250 billion worth of Chinese goods to date. The administration alleges that China engages in predatory practices, allowing the White House to retaliate under Section 301 of the U.S. Trade Act. Businesses that import items identified in first two rounds of tariffs, which cover $16 billion and $34 billion worth of goods respectively, can request an exemption if they can prove that the items cannot be obtained domestically. The decisions are made on a case-by-case basis. The White House has not allowed a similar process for the latest and largest round of tariffs, which covers $200 billion worth of goods.
The lack of a similar process for the current round came as a shock for the business community, and getting exemptions is a matter of urgency for many. The tariffs on those China goods are just 10 percent currently but they will increase to 25 percent at the beginning of next year, meaning many businesses could see steep cost increases soon.
The precedent, too, is alarming for lawmakers and business groups. The White House has repeatedly indicated that it may hit an additional $267 billion worth of Chinese goods with tariffs. That would be enough to cover all remaining imports coming into the US.
“Not only is the third tranche of section 301 tariffs more than four times the size of the first two lists combined, but it also contains a much higher percentage of consumer goods relative to intermediate and capital goods,” the senators noted.
A spokesperson for the administration could not be reached for comment.
