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First Increase in Section 301 Tariff Duties Scheduled for August 1, 2024




The U.S. Trade Representative (USTR) announced the continuation of Section 301 tariffs on Chinese imports beyond their four-year anniversaries. As part of the ongoing review, USTR is proposing to increase Section 301 tariffs duties on certain strategic products from China and introduce an exclusion process for specific machinery used in domestic manufacturing. Additionally, 19 temporary exclusions for solar manufacturing equipment are proposed. Public comments on these modifications and exclusions are invited until June 28, 2024.


Increased Tariff Rates: The USTR is proposing to increase tariffs on 382 HTSUS subheadings and 5 statistical reporting numbers, affecting products worth approximately $18 billion annually. These increases target strategic sectors and products identified by China for dominance. Here are some key categories:

  • Battery Parts (Non-lithium-ion):

  • HTSUS 8507.90.40: Parts of lead-acid storage batteries (25% starting in 2024).

  • Electric Vehicles:

  • Various subheadings under HTSUS 8702 and 8703, including vehicles with electric motors (100% starting in 2024).

  • Facemasks:

  • HTSUS 6307.90.9845 (N95 Respirators), 6307.90.9850 (Other Respirators), 6307.90.9875 (Other Face Masks) (25% starting in 2024).

  • Lithium-ion Batteries:

  • HTSUS 8507.60.0010 (for vehicles) (25% starting in 2024), 8507.60.0020 (Other) (25% starting in 2026).

  • Medical Gloves and Syringes/Needles:

  • Various HTSUS subheadings (25%-50% starting from 2024 to 2026).

  • Steel and Aluminum Products:

  • Various HTSUS subheadings under Chapters 72 and 76 (25% starting in 2024).


Machinery Exclusion Process: To support domestic manufacturing, the USTR is establishing a process for temporary exclusions from Section 301 tariffs for specific machinery classified under HTSUS Chapters 84 and 85. Eligible machinery includes:

  • Furnaces and ovens (HTSUS 8417.10.00, 8417.80.00).

  • Refrigerating equipment (HTSUS 8418.69.01).

  • Dryers and heat treatment equipment (HTSUS 8419.33.10, 8419.33.50, 8419.34.00).

  • Distilling or rectifying plant (HTSUS 8419.40.00).

  • Heat exchange units (HTSUS 8419.50.10, 8419.50.50).

  • Machinery for liquefying air or gas (HTSUS 8419.60.10, 8419.60.50).

  • Calendering or rolling machines for textiles and paper (HTSUS 8420.10.10, 8420.10.20, 8420.10.90).


Exclusions will be effective through May 31, 2025. The USTR is inviting public comments on these proposed exclusions, particularly regarding the scope and any omitted subheadings.


Solar Manufacturing Equipment: In a bid to bolster domestic production and decrease reliance on China, the USTR is proposing 19 temporary exclusions for solar manufacturing equipment, effective through May 31, 2025.

Public Participation


The USTR is seeking public comments on these proposed modifications. The comment period opens on May 29, 2024, and closes on June 28, 2024. Interested parties can submit their comments via the USTR’s online portal, which provides detailed instructions on submitting both public and business confidential information.

Conclusion


These proposed modifications to Section 301 tariffs reflect the USTR’s ongoing efforts to address the challenges posed by China’s trade practices. By increasing tariffs on certain products and providing temporary exclusions for essential machinery, the USTR aims to protect U.S. economic interests while encouraging domestic production. Stay informed and consider participating in the public comment process to ensure your voice is heard.


For more details and to submit comments, visit the USTR’s online portal at comments.ustr.gov.

USTR FRN Four Year Review Proposed Modifications fin
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