Tariff Increase Tomorrow Includes “On Water Exemption”

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As we reported here last night, the Office of the United States Trade Representative has issued a formal notice with modifications to section 301. As of this Friday, May 10th, tariffs on $200 billion worth of Chinese goods will increase from 10% to 25% (list 3).

The annex mentions the following: 

"Effective with respect to goods (i) entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on May 10, 2019, and (ii) exported to the United States on or after May 10, 2019, subchapter III of chapter 99 of the Harmonized Tariff Schedule of the United States is modified: 1. By amending U.S. Note 20(e) to subchapter III of chapter 99 by deleting ‘‘10 percent’’ each place that it appears, and inserting ‘‘25 percent’’ in lieu thereof; 2. by amending U.S. Note 20(g) to subchapter III of chapter 99 by deleting ‘‘10 percent’’ each place that it appears, and inserting ‘‘25 percent’’ in lieu thereof; 3. by amending the Rates of Duty 1-General column of heading 9903.88.03 by deleting ‘‘10%’’, and inserting ‘‘25%’’ in lieu thereof; and 4. by amending the Rates of Duty 1-General column of heading 9903.88.04 by deleting ‘‘10%’’, and inserting ‘‘25%’’ in lieu thereof."

Accordingly, goods in transit before May 10 are not subject to the increase.

If you need more information or have any questions, please contact our Customs and Trade team here

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If you are not sure how to proceed with your inventory strategy after the tariffs hit, please watch the recording of our Demand and Inventory Planning webinar that went live yesterday, May 8th. 

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