legislative

China Section 301 Issue Page

China Section 301

Chemical distributors pay, both directly and indirectly, hundreds of millions of dollars each year in government-imposed import taxes on products that are not made or found domestically. There is a direct link between tariff increases and reduced chemical sales, and this places an outsized burden on chemical distributors. NACD supports creating an exclusion process for all Chinese imports subject to duties imposed under Section 301 of the Trade Act of 1974.

Background

In 2018, President Trump unilaterally imposed a 25 percent tariff on a range of imports from the People’s Republic of China. The tariffs were imposed under Section 301 of the Trade Act of 1974, which authorizes the president to act on foreign practices deemed burdensome or restrictive to U.S. commerce. Hundreds of chemical products are listed under Section 301 List 3’s 25 percent tariff, which will result in a cost increase of $26.4 million to the chemical industry. Many chemical distributor companies lack the time and resources needed to shift suppliers. Multiple studies by NACD show a direct link between tariff increases and reduced chemical sales — simply put, lower volumes result in job loss. NACD recognizes that action is needed to address China's trade violations; however, not at the cost of harming American businesses and workers. 

 

NACD Supports:

  • Congressional oversight on trade policy, outlined in Article I of the Constitution, to protect U.S. businesses, consumers, workers, and families from the negative impact of both existing and proposed tariffs;
  • A requirement for the Office of the U.S. Trade Representative (USTR) to create an exclusion process for all Chinese imports subject to duties imposed under Section 301 of the Trade Act of 1974, that includes, specific criteria for how USTR should carry out product-wide exclusion grants and congressional authority to set exemption standards based on tariff imposition reviews.

 

Latest Action

USTR has implemented tariffs on four lists of Chinese import products. Items on Lists 1, 2, and 3 are at a 25% tariff rate and List 4A is at a reduced 7.5% tariff rate. Initially, the administration approved several exclusions among all the lists, but most of those exclusions have now expired. President Biden has not indicated that he will quickly reverse the tariffs. Most U.S. importers continue to advocate for overall removal of the tariffs, or, at a minimum, reopening of the exclusion extension process, so that the initially excluded items may have some tariff relief.

 

NACD Legislative Resources

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NACD Compliance Resources

 

For further questions about NACD’s China Section 301 Issue Page please contact Nicholas Breslin, Coordinator of Government Affairs at nbreslin@nacd.com.