Russia’s invasion of Ukraine marks the emergence of a potentially troublesome New World order. Partly because China is actively supporting and encouraging Russia’s aggression. It should sound a warning in Washington, as Beijing has revealed that it completely ignores the norms of democracy. In response, Congress needs to strengthen pending Chinese legislation to ensure that tariffs on Chinese imports are not weakened.
For decades, the United States has maintained the world’s most open consumer market. Not only does the United States import literally trillions of dollars worth of goods each year, it also imposes the lowest tariffs of any developed country.
Unfortunately, China has taken advantage of this generosity for the past 20 years. This is where the Trump administration finally emerged in 2018, when it imposed tariffs on Article 301 to punish China for years of intellectual property theft and other offensive practices.
As polls show, US consumers agree on tariffs and don’t want to buy Chinese goods. However, malicious importers are moving in the opposite direction, continuing to try to avoid China’s tariffs.
Section 301 contained an “exclusion process” that allowed importers to seek relief from tariffs on products they claimed were not available in the United States. After tariffs began in 2018, importers have called for many exclusions.
In the four years since then, importers have ample time to shift their supply chains from China. Instead, they are now pressing Congress to actually weaken current Chinese tariffs.
However, this is not entirely surprising, as the tariff exclusion process is full of abuse. The Coalition for a Prosperous America (CPA) recently investigated a number of importers’ claims for tariff relief. CPA has discovered that for many of the products in question, there are options made in the United States. However, the importer does not mention this in the petition. Instead, they claim to support more imports. Some even say, “We are seeking tariff relief for previous investments in development.” [their] Manufacturing base in China. “
The House of Representatives recently passed the US Competition Law of 2022 — a law aimed at increasing the US’s competitiveness against China. This follows a similar Chinese bill passed by the Senate last year. Unfortunately, the Senate bill will weaken the 301 tariffs by resurrecting exclusions and allowing tariff relief on China’s exports facing a “loss of profitability.”
China’s aggressive trading practices and support for Russia make it clear that China is not a friendly trading partner. In that case, it makes little sense for Congress to consider legislation that could actually undermine US trade law and allow China to expand predatory trade.
Tariff exclusions need to be reduced rather than expanded, as importers can easily find alternative producers outside of China. If anything, tariffs should be increased as they aim to reduce the dependence of the US supply chain on China.
Congress should either weaken the 301 tariffs or refuse efforts to allow the exclusion of fake tariffs. It’s time to revive American manufacturing through strong law.
Michael Stumo is the CEO of the Coalition for a Prosperous America, a non-profit bipartisan coalition of farmers, ranchers, manufacturers and trade unions that make and grow things in the United States. For more information, please visit https://prosperousamerica.org. Follow Stumo on Twitter with @michael_stumo
Parliament should not weaken China’s tariffs
Source link Parliament should not weaken China’s tariffs