GSP Issue Page

Generalized System of Preferences (GSP)

GSP is one of the most effective trade preference programs. On December 31, 2020, Congress allowed GSP's authority to lapse. Delaying the renewal of GSP has cost NACD members millions of dollars. NACD supports the retroactive renewal of GSP beginning January 1, 2021, passed by Congress as soon as possible.


The Generalized System of Preferences (GSP) is one of the most effective preference programs the Office of the United States Trade Representative has at its disposal to facilitate American business. The GSP provides non-reciprocal, duty-free tariff treatment on certain imported components, parts, or materials not domestically available. The lower costs result in the ability of U.S. companies to compete globally and contribute to our nation’s workforce.

NACD Supports:

  • Retroactive renewal of GSP beginning January 1, 2021, passed by Congress as soon as possible;
  • A short-term clean extension of GSP so that changes to the program can be discussed in a hearing with stakeholder input; and
  • Long-term renewal language to provide security to industry and participating countries.

Latest Action

While in years past the renewal of the program was not seen to be a particularly divisive issue, the program expired December 31, 2020, due to disagreement across the aisle. Both Sen. Chuck Grassley (R-IA) and Rep. Earl Blumenauer (D-OR) introduced reauthorization language late in 2020. The program expired due to disagreement over changes to GSP’s country eligibility criteria. As of January 1, 2021, Americans and former GSP-benefitting countries have been enduring excessive financial burdens due to congressional inaction.

Now that the program has expired, U.S. Customs and Border Protection will need to administer a messy rebate process that will cost chemical distributors the short-term liquidity necessary to withstand the impacts of the COVID-19 recession. In 2018, GSP’s authorization saw a lapse costing Americans $77 million in extra taxes paid in January alone. The program was retroactively renewed in April 2018, allowing importers to seek refunds of duties paid during the authorization lapse.


NACD Resources


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