On September 16, 2024, the Office of the United States Trade Representative ("USTR") announced the final modifications on China 301 tariffs after completing its statutory four-year review in May 2024.
As we reported in May 2024, President Biden directed USTR to take action to increase tariffs across "strategic sectors," such as steel and aluminum, semiconductors, electric vehicles, batteries, critical minerals, solar cells, ship-to-shore crane, and medical product. Subsequently, on May 28, 2024, USTR announced its proposed increases in Section 301 tariffs that cover products in 14 strategic sectors with an annual trade value of allegedly $18 billion USD ("May 2024 Proposed Modifications").
After reviewing over 1,100 public comments, the USTR announced on September 16, 2024, its decision to impose additional Section 301 tariffs on certain Chinese products in the specified strategic sectors. This decision includes certain adjustments to the May 2024 Proposed Modifications, such as clarifying effective dates for the tariff increases, increasing tariffs on certain facemasks, and adopting exclusions for solar manufacturing equipment.
The USTR's Notice of Modification of Actions ("Notice") was published on the Federal Register on September 18, 2024. Annex A of the Notice includes a table detailing tariff increases for 14 product groups, covering 382 HTSUS subheadings and 7 statistical reporting numbers, along with the applicable tariff rates and the years of the tariff increases. Specifically, the 2024 tariff increases will apply to products entered for consumption, or withdrawn from warehouse for consumption, on or after September 27, 2024. The increased 301 tariffs on products identified by HTSUS subheadings in the Notice in the following sectors will become effective in on September 27.
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Battery parts (non-lithium-ion batteries) |
Increase rate to 25% in 2024 |
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Electric vehicles |
Increase rate to 100% in 2024 |
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Certain Facemasks |
Increase rate to 25% in 2024 Increase rate to 50% starting 2026 |
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Lithium-ion electrical vehicle batteries |
Increase rate to 25% in 2024 |
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Other critical minerals |
Increase rate to 25% in 2024 |
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Ship to shore cranes |
Increase rate to 25% in 2024 |
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Solar cells (whether or not assembled into modules) |
Increase rate to 50% in 2024 |
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Steel and aluminum products |
Increase rate to 25% in 2024 |
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Syringes and needles |
Increase rate to 100% in 2024 |
Tariff increases in 2025 and 2026 are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, respectively on or after January 1, 2025 and January 1, 2026.
In Annex B of the Notice, the USTR adopts the 14 temporary exclusions (out of 19 temporary exclusions in the May 2024 Proposed Modifications) for solar manufacturing equipment by Product Description.
Annex E of the Notice contains a list of HTSUS subheadings eligible for consideration of temporary exclusions under the machinery exclusion process.
It is time to evaluate whether your products from China are subject to the increased Section 301 tariffs. As always, we are available to help your company navigate these tariffs. If you have any questions, please do not hesitate to contact us.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
