“Knowledge is Power.”

– Sir Francis Bacon

 

If Sir Francis’ wisdom always held true, Shapiro would benevolently rule all the world’s creatures, great and small, since we possess over a century of hard-won knowledge and expertise in Customs and international trade compliance. Fortunately for you, we are not power hungry – only hungry enough to empower you with the solid knowledge and powerful perspectives you need to prosper and grow during the first real trade war in generations.

Ask yourself:

  • In what ways are your company and the competition being affected by the imposition of additional tariffs under Section 301?
  • How will these additional costs and hurdles cut into your bottom line profitability?

What better time than now to leverage Shapiro’s vast knowledge and experience as you attempt to digest the complexities and uncertainties surrounding the imposition of significant additional tariffs, which will undoubtedly complicate and likely obstruct your pathway to healthy profits?

Background Information on The Section 301 Tariffs

As you are aware, on July 6, 2018, with the trade war between the U.S. and China looming, the United States Trade Representative (USTR) imposed an additional 25% duties on $34 billion of certain Chinese imports that contain “industrially significant technologies.” The finalized list of the 818 products subjected to the new tariffs, referred to as “List One”, can be found by clicking here.

On June 15, 2018, the USTR announced a second list (“List Two”), which included 284 additional subheadings – worth $16 billion – subjected to 25% additional tariffs. The final list of products affected by List Two can be found here; the additional 25% duties for this list went into effect on August 23, 2018.

On July 10th, a third list encompassing 6,031 items subjected to 10% additional duties and valued at $200 billion was released. The comment period for this list ended September 6, 2018. A finalized list of 5,745 lines of products subjected to these tariffs can be found here. Duties of 10% went into effect on September 28, 2018.

However, on Saturday, December 1, 2018, President Trump announced that Section 301 List 3 tariffs, which were set to increase from 10% to 25% effective January 1, 2019, will now remain at 10% for an additional 90 days, as a result of fruitful talks with Chinese President Xi Jingping at the G20 summit in Buenos Aires.

On September 17, 2018, the Trump administration suggested that additional tariffs (a “List 4”) may be announced on another $267 billion of Chinese goods if negotiations with the Chinese do not fare well. No further detail has been provided.

Here’s a quick snapshot of the details and important dates surrounding all of the new U.S. tariffs:

Section 301 Reference Chart – U.S. Tariffs (Importers)

 

Covered Products

 

Additional Tariff Rate

 

Status

 

Relevant Dates

 

First Round

818 HTSUS

subheadings

 

25%

 

Final

  • Effective 7/6/18
  • Exclusion Filing Deadline 10/9/18

 

Second Round

284 HTSUS

subheadings

 

25%

 

Final

  • Effective 8/23/18
  • Exclusion Filing Deadline 12/18/18

 

Third Round

 

Approximately 5745 HTSUS subheadings

 

 

10% in 2018 & 2019

 

 

Final

  • Effective 9/28/18 (10%) & Potentially Increasing to 25% in March 2019
  • Exclusion Filing Deadlines TBA

 

Yes, China has responded – with some tariffs of its own!

China’s response to all rounds of 301 tariffs imposed by the U.S. was swift, with President Xi Jinping approving tit-for-tat retaliatory tariffs. China’s response appears to target the populations they consider to be the Trump administration’s core supporters – U.S. farmers, ranchers and industrial workers.

Let’s take a closer look at the retaliatory tariffs and their targets:

List One Retaliation:

China imposed 25% tariffs on 545 U.S. products – totaling $34 billion. These tariffs went into effect on July 6, 2018 and specifically targeted soybeans, automobiles and various chemicals. A final list of all products affected by the list one retaliation can be found here.

List Two Retaliation:

In the wake of the United States’ announcement of List Two, China also implemented 25% tariffs on 333 goods – worth $16 billion. Tariffs went into effect on August 23, 2018; this time the focus was on coal, copper scrap, fuel, buses and medical equipment. A final list of all products affected by the list two retaliation can be found here.

List Three Retaliation:

In response to List Three, China issued tariffs of 5-10% on an additional 5,207 products, totaling $60 billion worth of goods. These tariffs went into effect on September 24, 2018 and targeted agricultural equipment, machinery, chemicals and textiles.

List Three included several retaliatory waves. A full breakdown of list three retaliations can be found by selecting phase one, two, three or four.

China paired these tariffs with published government documents that further express their bleak stance on the future of U.S.-China trade.

Here’s a quick snapshot of the details and important dates surrounding the Chinese retaliatory measures:

Section 301 Reference Chart – Chinese Tariffs (Exporters)

 

Covered Products

 

Additional Tariff Rate

 

 Status

 

Relevant Dates

 First Round

 

545 products – soybeans, automobiles, various chemicals

 

 

25%

 

Final  

  • Effective 7/6/18

 

Second Round 333 products – coal, fuel, buses, medical equipment

 

25%

 

Final
  • Effective 8/23/18
 Third Round

 

5,207 products – agricultural equipment, machinery, and textiles

 

 5% – 10% Final  

  • Effective 9/28/18

 

 

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