Temporary Reduction in US-China Tariffs

China and the United States have agreed to a temporary reduction in import duties. Details are included in the related Executive Order.

For 90 days, the United States will charge a baseline tariff of 10% of the value of products of China, plus the 20% “fentanyl” tariff on product of China, plus the 25% tariff on certain aircraft parts (HTSUS 9903.88.01 – where appropriate). Many aircraft parts are subject to the additional 25% duty under this provision, including those under (for example) headings 8409, 8411, and 8807.

During this same period, China will apply a 10% tariff (plus any special tariff on aircraft parts) to goods that are the product of the United States.

These tariffs are based on the “country of origin” of the goods, and not based on the origin of the transaction.

The temporary pause is schedule to begin tomorrow, May 14, and will continue for 90 days. After that, the U.S. tariffs on products of China are scheduled to go back to a baseline of 34% instead of 10%.

Change in China Tariffs Add Aircraft Seats to the Mix, But Offer No Relief to the US Importers of Aircraft Parts from China

On August 13th, the United States Trade Representative (USTR) announced a change in the net round of anticipated China tariffs.

In May, the USTR announced a set of tariffs expected to go into effect on September 1.  Each tariff would apply a 10% duty (which must be paid by the importer) on certain goods.  The May announcement reflected tariffs applying duties to about $300 billion worth of US imports from China.  This list of tariffs had been identified as list 4.

List 4 has been split into list 4A and list 4B.  The tariffs described in list 4A will go into effect September 1, 2019, as scheduled; but the tariffs described in list 4B will be delayed until December 15, 2019  The official reason for this delay is to mitigate the effect on US consumers in advance of Christmas.  Products in this group 4B include cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing.

  • List 4A (Effective September 1, 2019).
  • List 4B (Effective December 15, 2019).

Note that this change does not affect the aircraft parts that are already subject to 25% tariffs; however list 4A will add aircraft seats to the list of goods from China that are subject to tariffs (tariff codes 9401.10.40 and 9401.10.80).  US importers of aircraft seats from China should take note of this September 1 date!

The USTR has stated that “Certain products are being removed from the tariff list based on health, safety, national security and other factors and will not face additional tariffs of 10 percent.”  It is unclear at this time which articles will be removed from the lists, but the USTR has promised to publish additional details in the Federal Register, soon.