Third Wave of Section 301 Tariff Increases Officially Delayed
On March 5, 2019, the Office of the United States Trade Representative (“USTR”) published a notice in the Federal Register officially postponing the date on which the rate of Section 301 duties on $200 billion of Chinese goods (i.e., List 3 items) will increase from 10% to 25%.
USTR’s notice follows President Trump’s announcement of his decision to delay the March 2, 2019 deadline for increasing tariffs on List 3 items due to “substantial progress” in his administration’s talks with China, as well as Ambassador Lighthizer’s testimony before the House Ways and Means Committee concerning the same issue.
The 10% percent duties, which took effect on September 24, 2018, were initially set to increase to 25% on January 1, 2019, but that deadline was delayed to March 2, 2019 pursuant to a December 19, 2018 Federal Register notice. USTR’s March 5, 2019 notice does not establish a new deadline for an increase in duties, but instead leaves the possibility of an increase open.
As Ambassador Lighthizer indicated in his testimony to the House Ways and Means Committee, there has been no agreement to remove the current 10% tariff on List 3 items, though the removal of such tariffs is a negotiating objective of the Government of China. We will continue to monitor further developments regarding the Trump Administration’s Section 301 tariffs and trade negotiations with China.