International trade and politics are inseparable, and yet it seems that politics is rarely brought into conversation between international shippers and transportation providers. After all, international trade remains largely standardized amongst cultures with very different governmental structures, laws, regulations, and practices. However, every once in a while, new trade laws are put into action that affect a great deal of workers and companies in the shipping industry.
Most recently, this has come in the form of Trump’s new China import tariff laws. Initially, importers across the U.S. were impacted by the 25% tariff on imported steel, but as of July 6th, a whole new list of Chinese imported products will be taxed at the same rate. Here’s a little bit about it:
Tariff Rates: Definition and Purpose
We assume that most people who are reading this article are already familiar with tariff rates, so we will keep it short and sweet. For those who would love to learn more about tariff rates, we have articles on how they affect international transportation costs, and the different types of tariff rates. If you haven’t yet learned about tariff rates, we encourage you to read those articles first.
In short, an import tariff is a taxation placed on goods that are imported to the United States. But all goods are taxed at different rates depending on the type of commodity, quantity, country of origin, etc. All these specific rates can be found via an HTS Code lookup. An HTS Code is a code with a unique set of numbers for each category and specific subset of products. Take coffee for example:
- 0901: Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion
- 11.00: Not Decaffeinated
- 12.00: Decaffeinated
- 90.10: Coffee Husks and Skins
- 90.20: Coffee Substitutes
“0901” is the preface of the code which refers to the general categorical umbrella of coffee products, while the remainder of numbers refer to the specifics of each product subset. Tariffs placed on coffee products may apply similarly between all “0901” products, but taxations may also be specific to only certain products under the “0901” umbrella.
In summary, tariff rates serve two primary purposes:
- Raise Government Money: The government must staff U.S. Customs workers, man the port, inspect containers, pay for equipment, etc. This money must be raised in some way, and placing small (or sometimes large) tariff rates on imported products allows our government to employee government Customs workers at U.S. ports.
- Control Domestic Production: Take the example of shoes – If a shoe costs $1.00 to produce in the U.S., but $0.50 to produce in China, it would be in the best interest of U.S. footwear retailers to purchase and import shoes from China. But if the government jacks of the tariff rates associated with Chinese shoe imports, it will encourage more U.S. companies to produce shoes locally since it will be more cost-effective for local buyers to purchase from domestic producers.
Trump’s Tariff Laws
In March and June, Trump had set new tariff laws on imported Steel and Aluminum, with rates being set at 25% and 10% respectively. However, as of July 6th, new tariff laws will be deployed that affect a whole slew of different products. The issue is, there isn’t much coverage on the internet as to exactly what products are affected by this tariff.
Following the recent June tariff rates, here is a second list of products from China that the Office of the United States Trade Representative (USTR) have disclosed to become subject to an additional 25% duty. Under Section 301 of the Trade Act of 1974, USTR has issued a schedule for providing comments to this second list.
For clarity on impacted products, here is a specific list based on the HTS Code of these products. Here is a link to the HTS Code lookup site if you would like to learn more about each product. Just copy and paste the codes for product specifications:
2710.19.(30-40): Lubricating oils/greases
3403.19.(10 & 50): Lubricating preparations
3403.99.00: Lubricating preparations
3811.29.00: Additive for lubricative oils
3901.xx.xx: Polyethylene, ethylene, and polymer products
3902.xx.xx: Polypropylene, polyisobutylene, propylene, and polymers
3903.xx.xx: Polystyrene, styrene-acrylonitrile, ABS copolymers, and styrene polymers
3904.xx.xx: Polyvinyl chloride, Vinyl chloride , Vinylidene chloride, polytetrafluoroethylene, and Fluoropolymers
3905.xx.xx: Polyvinyl acetate, and copolymers of vinyl esters
3906.xx.xx: Polymethyl methacrylate, and acrylic polymers
3907.xx.xx: Polyacetals, polyethers, epoxide resins, polycarbonates, alkyd resins, unsaturated allyl resins, and thermoplastic liquid crystals
3909.xx.xx: Resins of: urea, melamine, and phenolic. Polyurethanes.
3910.00.00: Silicones in primary forms
3911.xx.xx: Petroleum resins, elastomeric polysulfides, carbodiimide, benzenamine, and chlorinated synthetic rubber
3912.xx.xx: Cellulose acetates, nitrates, ethers, and nesoi
3913.xx.xx: Alginic acid, natural polymers, and natural rubber chemical derivatives
3914.00.(20 & 60): polyvinylbenzyltrimethylammonium chloride, and ion-exchangers based on headings of 3901 and 3913
3916.xx.xx: Monofilament, and monofilament nesoi
3917.xx.xx: Tubes, pipes and hoses, rigid, of polymers of ethylene, propylene, vinyl chloride, and plastics nesoi
3919.xx.xx: Self-adhesive plates, sheets, and other flat surfaces produced by glass grains and nesoi
3920.xx.xx: Nonadhesive plates, sheets, film, foil and strip
3921.xx.xx: Nonadhesive plates, sheets, film, foil and strip
7002.20.10: Glass rods of fused quartz or other fused silica, unworked
7308.xx.xx: Iron or steel
7614.xx.xx: Aluminum wire, cables, conductors, and other products
8406.82.10: Steam turbines
8407.xx.xx: Spark ignition reciprocating piston engines
8408.20.10: Compression-ignition internal-combustion piston engines
8419.xx.xx: Certain types of machinery
8420.xx.xx: Rolling machinery for paper, processing textiles, etc.
8424.xx.xx: Machinery for spraying liquids
8443.99.40: Parts of photocopying apparatus
8455.90.40: Parts for metal-rolling mills
8464.10.01: Sawing machines for working stones, ceramics, and concretes
8465.(95 & 96).00: Drilling, splitting, and slicing machines for wood, cork, bone, rubber, etc.
8466.30.80: Certain machinery attachments
8473.50.(60 & 90): Parts for certain machinery
8475.29.00: Machines for working glass
8483.30.90: Bearing hosings nesoi
8486.xx.00: Machines for manufacturs of boules or wafers, plat panel displays, masks, reticles, and semiconductors
8501.xx.xx: Electric and DC motors and generators
8507.xx.xx: Storage batteries nesoi
8511.xx.xx: Voltage and boltage-current regulators
8533.90.40: Ceramic or metallic materials electrically/mechanically reactive to temperature changes
8536.xx.xx: Electrical apparatus for circuits, snap switches, and optical fiber connectors
8537.10.30: Electric control panels
85(41, 42, 43, & 44).xx.xx: Diodes, electronic integrated circuits, synchros, transducers, and electric conductors nesoi
86(01 & 02).xx.xx: Rail locomotives, diesel-electric locomotives
86(05 & 06).xx.xx: Railway/tramway passenger coaches, tank cars, and freight cars
8607.xx.xx: Parts of railway/tramway/rolling stock cars
8701.xx.xx: Road tractors
87(04 & 05).xx.xx: Mtr. Vehicles
8901.30.00: Vessels designed for transport of goods
8905.90.10: Floating docks
9001.(10 & 20).00: Optical fibers, polarizing material
9025.xx.xx: Pyrometers, thermometers, and electrical hydrometers
90(27 & 28).xx.xx: Gas/smoke apparatus, microtomes, gas supply meters, liquid meters, etc.
9029.xx.xx: Speedometers, and parts of revolution counters
9030.xx.xx: Multimeters and instruments for measuring electric voltage and quantities
Full List of Trump’s China Tariff Affected Products
If you are interested in finding out whether or not your specific product is impacted by Trump’s new tariff laws going into effect on July 6th, you can read the full list here.
If you have any questions regarding these tariffs, or other general questions regarding tariffs and imports, we would encourage you to give us a call. Our team of experts is always happy to help people get a better grasp on topics like this.