New Import Tariffs for Aircraft Parts from Belarus or Russia

June 30, 2022 by Leave a comment

Very little is being imported from Russia these days, but if you are importing Russian aviation products then you need to be aware of the unusual tariff treatment of those goods.

There is a “column two” in the harmonized tariff system of the United States. Column two is used for nations with whom the United States does not have normal trade relations (currently Cuba, North Korea, Russia and Belarus). Column two imposes much higher import duties. In April, Congress (P.L. 117-110 § 3(a) (April 8, 2022)) determined that column two would apply to products of Belarus and Russia. This means that aircraft parts from these two jurisdictions lose their duty-free status.

In today’s Federal Register, the President proclaimed a change in the column two duties that apply to many products from Russia, including certain aviation products and parts. This does not (yet) apply to Belarus. In essence for any affected goods, the 35% duty replaces whatever duty was normally established in column two.

For example, imagine you are importing a unit load device that is a product of Russia. It falls under tariff code 8609.00.00.00, which is for containers. As a container, it would have been subject to free (zero duty) entry under column one, but it would have been subject to a 25% duty under column two.

But under the new tariff rules, the same container will be subject to a 35% duty if it is imported from Russia.

Many aircraft parts under heading 8807 will be affected by this new rule (including those under 8807.10.00, 8807.20.00, 8807.30.00 and 8807.90.90. These new tariff rules apply only to Russia (not Belarus) and they go into effect on July 27, 2022.

For a complete list of the affected products, as well as full details on this new provisions, review the Presidential Proclamation in the Federal Register.

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New Agreement With China – No Relief for US Aircraft Parts Importers

January 16, 2020 by 2 Comments

I almost titled this post “Boeing Wins. Aviation Loses.”  But I am not sure that Boeing even wins under this Agreement.

The United States and China have signed a new trade agreement.  For most of the aviation industry, very little changes.  Aircraft parts imported into the United States that were subject to the 25% duty associated with the section 301 tariff, continue to be subject to the 25% duty levied on parts from China.

China has agreed to place orders for additional manufactured goods.  The list of manufactured goods includes complete aircraft, but does not include aircraft parts.  The obligation can be met by merely placing orders.  Thus China can meet its obligations under the new agreement by placing orders for aircraft for the first three years and then refusing delivery after the three year term of the agreement.  So even though it looks like this could be a boon for Boeing, it might not be as beneficial as one might think.  Furthermore, there is no agreement to purchase aircraft parts, and companies like Boeing sell a significant volume of parts.

The agreement does not appear to change the List One tariffs.  The list one tariffs became effective on July 6, 2018 and placed an additional duty rate of 25% on $34 billion worth of goods from China.  The list one goods include (but are not limited to):

  • 40113000 (New pneumatic tires, of rubber, of a kind used on aircraft)
  • 40121300 (Retreaded pneumatic tires, of rubber, of a kind used on aircraft)
  • 84071000 (Spark-ignition reciprocating or rotary internal combustion piston engines for use in
    aircraft)
  • 84091000 (Parts for internal combustion aircraft engines)
  • 84111140 (Aircraft turbojets of a thrust not exceeding 25 kN)
  • 84111240 (Aircraft turbojets of a thrust exceeding 25 kN)
  • 84112140 (Aircraft turbopropellers of a power not exceeding 1,100 kW)
  • 84112240 (Aircraft turbopropellers of a power exceeding 1,100 kW)
  • 84118140 (Aircraft gas turbines other than turbojets or turbopropellers, of a power not
    exceeding 5,000 kW)
  • 84118240 (Aircraft gas turbines other than turbojets or turbopropellers, of a power exceeding
    5,000 kW)
  • 85030045 (Stators and rotors for electric generators for use on aircraft)
  • 85030090 (Parts for electric generators suitable for use on aircraft)
  • 85443000 (Insulated ignition wiring sets and other wiring sets of a kind used in vehicles, aircraft
    or ships)
  • 88031000 (Parts of airplanes and other aircraft, propellers and rotors and parts thereof)
  • 88032000 (Parts of airplanes and other aircraft, undercarriages and parts thereof)
  • 88033000 (Parts of airplanes and helicopters, not elsewhere specified or included)

As a condition of the agreement, the United States apparently agreed to cut certain (non-aviation) tariffs from a 15% duty to a 7.5% duty.  The USTR Fact Sheet acknowledges that “The United States has agreed to modify its Section 301 tariff actions in a significant way.”  These alleged modifications/reductions in duty rates are not part of the written agreement between China and the US, that has been released, so it is possible that US importers will continue to pay these duties.

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