2 Aug 2018
Senate Passes Miscellaneous Tariff Bill; Must Be Reconciled with House Version to Become Law
The Senate approved by unanimous consent on 26 July its own version of the Miscellaneous Tariff Bill Act of 2017 (H.R. 4318), which would reduce or suspend import duties through 31 December 2020 on nearly 1,700 products that are not otherwise available in the United States. Since the Senate version is slightly different from the version passed by the House of Representatives in January, to become law the two versions will need to be reconciled into a unified bill that then passes both legislative houses and is subsequently forwarded to President Trump for signature. The differences between the two bills are not very substantial, consisting of the removal by the Senate of seven products (two chemical products as well as certain collapsible insulated food and beverage bags, rotary cutting hand tools, electric commercial vehicles, cabs and bodies for electric vehicles, and mixed rare earth oxides known as Luminostar UY), somewhat dissimilar descriptions for three footwear products, and slightly different language on customs user fees.
H.R. 4318 includes a broad range of products of potential interest to Hong Kong and mainland Chinese exporters. A majority of the products that made it to the final House and Senate bills are chemical inputs. Also in the legislation are various plastics and plastic products, camera flotation devices, rubber pet toys, automotive gaskets, conveyor belting of vulcanised rubber, life jackets for pets, sleeping bag stuff sacks, non-woven polypropylene bags, novelty backpacks, binocular carrying cases, bags designed for janitorial carts, cases for electronic games or accessories, women’s leather jackets, leather gloves, boxing gloves, leather belts, woven wood and bamboo products, cashmere and camel hair, cashmere and camel hair yarn, woven fabric of vicuna hair, woven cotton gauze, pique fabric, 50D nylon, polyvinyl alcohol yarn, high tenacity single rayon yarn, polypropylene monofilament, elastic water-repellent woven polyester fabric, acrylic filament tow, acrylic and viscose rayon staple fibres, hand-tufted wool carpets, various garments incorporating snaps used to attach a heart rate monitor, women’s and girls’ man-made fibre knitted vests, men’s and boys’ silk knitted pullovers and cardigans, girls’ cotton knitted coveralls and jumpsuits, neoprene wading socks, various woven garments, nylon wool packs, sleeping bag shells, textile ice bags, various footwear and headwear products, patio umbrella frames, plastic plants, glass beads, cookware covers, glass-ceramic cookware, padlocks, manicure and pedicure sets, various machinery and equipment, swim goggles, projection screens, multi-metres, LED lamps, golf club heads, tennis and squash rackets, volleyballs, basketballs, fitness equipment and tripod camera mounts, among many other products.
The MTB process provides that non-controversial products, which are identified by a narrow description within a given HTSUS tariff line, can be afforded duty-free or reduced-duty treatment. Since the total value of the duty savings is limited to a maximum of US$620,000, some products are afforded reduced-duty in lieu of duty-free treatment so as not to exceed that threshold. In addition, the product cannot be designated if any U.S. entity objects to its inclusion.
Prior to 2012, MTB bills were introduced by individual members of Congress and then packaged as one bill (hence the term “miscellaneous tariff”). The last MTB expired in 2012 and in 2016 the MTB process was changed by shifting the focus from lawmakers to businesses, which would petition the U.S. International Trade Commission directly for MTB exemptions. Following completion of the required USITC report, the Senate and House could remove products but could no longer add any products. In August 2017, the USITC, with input from the U.S. Department of Commerce and U.S. Customs and Border Protection, provided a final report to Congress that included recommendations concerning more than 2,500 petitions. The USITC recommended that more than 1,800 of the petitions be included in the MTB legislation and nearly 1,700 products made it to the final House and Senate bills.