Day 2 Tariffs: (Phil's post below will have day 2 highlights that are not tariff related)
Phil and I needed to divide and conquer this morning so we could meet with our appointments and also attend the session on Tariffs and how they are/will effect the bike industry.
I'm sitting in the session, which was held up a few minutes to see if more people were coming in. There are a total of 15 people, including me at the moment, (note: by the end of the session, there were 25 people in attendance)
NOTE: Tariffs are an important discussion for both bike and ski related topics. Please keep this discussion on track for how it impacts us, and keep it civil. This will not be turned into a left/right political discussion
The first thing to understand the background on Section 301:
Section 301 of the Trade Act of 1974 was set up allow the President of the United States to set tariffs to protect intellectual property of the US without Congressional approval.
The only way that this can be repealed is if Congress makes a strong move to do so, which can be vetoed by the President.
In the first round of tariffs, 50 billion in products were involved in the first round, which was pared down to 34 billion. The biggest part of the bike industry impact was GPS.
2nd round E-Bikes and E-bike motors were included. This was 16 billion in tariffs which reflect the pared down amount from the first round.
3rd round is the biggest impact and impacts most bikes, parts, and accessories.
On September 17, USTR made an announcement regarding implementation of the Round 3 tariffs:
- The tariff will be raised by 10% effective Monday September 24, 2018
- The tariff will raise by an additional 15% (total increase of 25%) on January 1, 2019
An emphasis was made that the bike industry was already paying a fairly heavy tariff prior to these, something around 7% depending on the product.
Prior to round three going into affect, People for Bikes as well as other lobbying groups had over 200 people testify in an effort to have this list pared back. The biggest roll back was for helmets and lights because they were able to make a case for safety.
A new law will provide tariff relief for several product categories on October 13, 2018
- Disc brakes
- Stand up and elliptical bikes
- unicycles
- speedometers
- Zee cages
- Reflectors
- Water bottle caps
- Some shoes(Depending on the HDS code you use to import)
What's next?
Even though Congress can't override the tariffs set forth by the President, it is important to continue to lobby and do everything we can to fight back in an effort to get some of these tariffs pulled or pared down.
In the mean time, if you're importing from China, you can appeal to have the tariff lifted, but you have to show proof that you can't source from the US or a US friendly country.
Example:
*I typed and uploaded images while it was happening. There is so much to absorb.
For updates on tariffs and regulations associated with tariffs go to
https://www.regulations.gov