SEMA eNews Vol. 12, No. 27, July 9, 2009

Government Recommends Higher Tariffs on Tires from China

The U.S. International Trade Commission (ITC) recommended imposing tariffs of up to 55% as a remedy for a previous decision that surging tire imports from China were causing market disruption in the United States. Tariffs are currently 4% for radial passenger and light truck tires, and 3.4% for bias passenger and light-truck tires.

The tariffs are now subject to President Obama’s approval. A decision is expected by mid-September. The President has the authority to approve, deny or decide some other form of relief.

Last April, the United Steelworkers union, representing about 15,000 U.S. tire workers, alleged that an import surge of Chinese-made tires had caused major job losses and plant closures in the United States. The union argued that China exported nearly 46 million tires last year to the U.S., and that the volume had tripled since 2004 while domestic production had decreased by more than 25 percent.

The ITC found in favor of the United Steelworkers’ petition on June 18. Rather than impose a quota system limiting imports, the ITC has now recommended raising tariffs. The additional duties would total 55 percent in the first year, 45 percent in the second year and 35 percent in the third year. The subject tires are classifiable in the Harmonized Tariff Schedule under subheadings 4011.10.10, 4011.10.50, 4011.20.10 and 4011.20.50.

Questions? Contact Stuart Gosswein.

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