Trump Administration Weighing 90-Day Deferral of Tariffs
(Bloomberg) -- The Trump administration is debating whether to defer payments of duties on imported goods from around the world for three months, people familiar with the talks said.
Discussions in recent days involving the U.S. Customs and Border Protection and other government agencies about suspending tariffs, across a broad range of goods, for a three-month period sparked push back from domestic industry associations.
In a letter to acting CBP commissioner Mark Morgan, the Coalition for a Prosperous America expressed concern that the move was under consideration.
“At a time of ﬁnancial hardship and unrest as a result of the coronavirus – CBP should not reintroduce unfairly traded goods to cause American workers further economic pain because of lobbying efforts of stateless companies,” the group wrote Tuesday. “This effort by CBP will only exacerbate the ﬁnancial situation of countless Americans.”
An administration officials said the President has said there is no need for tariff relief and it isn’t something that’s on the table.
Amid supply chain turmoil and rapidly falling consumer demand, many small- and medium-sized companies have been disproportionately impacted by the virus outbreak and are awaiting government support from a stimulus package that the administration is in the final stages of negotiating with Capitol Hill.
President Donald Trump has resisted calls for tariff cuts that have become increasingly loud as the coronavirus outbreak in the U.S. caused widespread economic harm. Last week, he made clear that “there’s no reason” for tariff relief even as a wide range of industries buckle from the shutdown of businesses.
The cash flow problems companies are facing because of the public health crisis and weight of additional levies from tariffs should be considered, California Senator Dianne Feinstein, a Democrat, wrote in a letter to Treasury Secretary Steven Mnuchin that’s being circulated for signatures.
“At such a moment when Congress has clearly indicated that deferring employer taxes should be a part of the U.S. response to the crisis, the Treasury Department should direct that all tariffs will be deferred for at least 90 days and, more broadly, until the companies paying them can emerge from the ongoing crisis,” according to a copy of the letter seen by Bloomberg.
But some industries with tough competition from abroad say the deferral could harm their businesses.
“This approach might very well be a death blow for domestic manufacturers simply trying to stay in business and for their workers struggling to survive,” said Michael Wessel, who works with the United Steelworkers Union and other domestic industry groups. “Letting importers off the hook for such an extended period from having to pay duties at this critical time could be the difference between survival and bankruptcy.”
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