Industry News

Congress Sends Miscellaneous Tariff Bill to the President, Gives Importers Short Window to Claim Retroactive Benefits

July 28, 2010


Yesterday, the U.S. Senate passed the U.S. Manufacturing Enhancement Act of 2010 (H.R. 4380), clearing for the President the first miscellaneous tariff bill(MTB) in nearly three years. The legislation suspends or lowers duties on hundreds of manufacturing inputs, raw materials and other products.

While both democrats and republicans agree that the legislation cuts business costs for thousands of U.S. companies and helps support employment in the U.S., the Republican leadership had resisted supporting the legislation due to its self-imposed ban on earmarks, which was determined to include limited tariff benefits.

In fear of Republican objections however, measures included H.R. 4380 are limited to:(1) bills requesting new duty suspensions or reductions that have a House and Senate counterpart; (2) House bills extending expired provisions; and (3) Senate bills extending expired provisions. Duty suspension and other tariff bills not included in H.R. 4380 will be considered in a second MTB package at a later date.

H.R. 4380 will create new HTS 9902 duty-suspension and duty reduction provisions, and extend and/or revise others that have expired (most or all expired on December 31, 2009). Revisions include changes to written product descriptions and/or changes to duty rates (some duty rates would increase), etc. The duty suspension and reduction provisions (both new and those being extended) in H.R. 4830 become effective for goods entered or withdrawn from warehouse of consumption 15 days after the date of enactment and will expire on December 31, 2012.

In addition to creating new and extending existing HTS 9902 subheadings, H.R. 4380 provides for the retroactive duty treatment for expired provisions. Goods entered or withdrawn from warehouse for consumption on or after January 1, 2010 but before the effective date, that would have qualified for HTS 9902 treatment had the appropriate provision not expired, will be eligible to be liquidated or reliquidated as if the entry or withdrawal had been made after the bill’s effective date. Liquidation, reliquidation must be requested within 180 days. Such a liquidation or reliquidation may be made with respect to an entry or withdrawal only if a request is filed with U.S. Customs and Border Protection not later than 180 days after the date of enactment. The request must contains sufficient information to enable CBP to locate or reconstruct (if it cannot be located) the entry or withdrawal.

The House managed to overcome republican objections by recasting the MTB as part of Speaker Nancy Pelosi’s “Make in America Agenda.” The agenda, which was announced on July 20, 2010, seeks to pass 18-20 different bills, including one on China currency.

The White House has not yet announced when the President will sign the bill into law, but it is expected that he will do so expeditiously.