The Office of the United States Trade Representative finalized modifications to Section 301 tariff actions against the People’s Republic of China on September 13, 2024, largely adopting proposed changes first announced May 28, 2024. The action follows a statutory four-year review process that began in May 2022 and drew nearly 1,500 public comments on an initial November 2022 docket, plus more than 1,100 comments on the May 2024 proposed modifications. The tariffs were originally imposed in response to the PRC’s acts, policies, and practices related to technology transfer, intellectual property, and innovation.
What it means
The final modifications adjust tariff timing and rates on face masks, medical gloves, needles, and syringes; add an exclusion for enteral syringes; and create an exclusion for ship-to-shore cranes ordered before May 14, 2024. USTR also expanded the machinery exclusions process to cover five additional tariff lines and modified proposed exclusions for solar manufacturing equipment. USTR said it expects to launch the machinery exclusions process soon and to open a comment period on proposed tariff rate modifications for certain tungsten, wafers, and polysilicon tariff lines.
The review found that the PRC has not eliminated many of its technology transfer-related acts, policies, and practices, and that forced technology transfer practices — including cyber theft and industrial espionage — have continued and in some instances worsened, according to USTR. Economic analyses reviewed during the process, with the principal analysis published by the U.S. International Trade Commission, found that the Section 301 tariffs have had positive impacts on U.S. production in the 10 sectors most directly affected and minimal impacts on economy-wide prices and employment. The analyses also found small negative effects on U.S. aggregate economic welfare, which USTR attributed primarily to retaliatory tariffs the PRC applied to U.S. exports. USTR said the tariffs have contributed to reducing U.S. imports of goods from the PRC and increasing imports from U.S. allies and partners.
Key facts
- Action: USTR finalized Section 301 tariff modifications, September 13, 2024
- Statutory four-year review commenced: May 2022
- Tariff actions confirmed as continuing: September 2022
- Public comment docket opened: November 15, 2022; nearly 1,500 comments received
- Proposed modifications announced: May 28, 2024; more than 1,100 comments received
- Products with updated tariff timing and rates: face masks, medical gloves, needles, syringes
- New exclusions: enteral syringes; ship-to-shore cranes ordered prior to May 14, 2024
- Machinery exclusions process expanded to five additional tariff lines
- Forthcoming actions: machinery exclusions process launch; comment period on tungsten, wafers, and polysilicon tariff lines
- Principal economic analysis: U.S. International Trade Commission
Source: Office of the United States Trade Representative news release (ustr.gov)