The Trump administration has granted about one out of every two requests from importers to be exempted from the tariffs it has placed on imports of steel and aluminum products.
The high exclusion rate undermines the administration’s claim that the tariffs are needed for national security, critics say, and also raises questions about the rationale for granting exemptions.
A Commerce Department spokesman told the Washington Examiner that as of Sept. 15, it has received 127,291 steel and aluminum tariff exclusion requests overall. Out of the 111,817 requests for steel product exclusions the administration has received, it has granted 47,612, or about 42%. The administration has also received 15,474 exemption requests for aluminum products and granted 7,762 of those, about 50%.
That’s more than twice the rate at which the administration has granted exclusions for products covered by its China-specific tariffs, according to data released last month by the U.S. Trade Representative’s Office.
“The tariffs on steel and aluminum were imposed under the false pretense of national security,” said Bill Jaffee, spokesman for Sen. Pat Toomey, a Pennsylvania Republican who has demanded a Government Accountability Office probe into the process. “Making matters worse is the Commerce Department’s broken exclusion process. It is past time for these tariffs to be lifted and for Congress to reclaim its constitutional authority on trade.”
The administration last year placed 25% tariffs on imports of steel products and 10% tariffs on aluminum ones, citing Section 232 of the Trade Expansion Act. The administration justified the tariffs on the grounds of national security, arguing that the Pentagon needed domestic sources for the metals, should foreign sources become unavailable. The Section 232 tariffs are overseen by the Commerce Department.
In terms of China tariffs, the administration has also placed 25% tariffs on $250 billion worth of goods and 15% tariffs on another $300 billion worth of goods, in both cases citing Section 301 of the Trade Act. The 25% tariffs are set to rise to 30% on Oct. 15. Those tariffs are overseen by the U.S. Trade Representative. The combined $550 billion of goods is expected to cover all virtually imports coming in from China.
In both cases, businesses and trade groups can request exclusions from the tariffs on the grounds that the products aren’t available domestically and granting an exemption would not constitute a security risk. The different branches of the government have different processes. The USTR has a ‘product exclusion request’ system. If it grants an exclusion, the product itself is no longer under a tariff and nobody importing it has to pay. The Commerce Department exclusion process is much narrower. If it grants an exclusion to a steel or aluminum product, it is solely for the company that made the request.
