The Miscellaneous Tariff Bill (MTB) is a bill that could provide importers with the opportunity to save on duties if cases are submitted to the USITC (U.S. International Trade Commission) and approved by Congress. The bill resulted in the USITC establishing a web portal for importers to petition to suspend or reduce duties on products that are either not produced in the United States or produced in insufficient quantities. Below are the top three items our team thinks importers should know.
1. Before explaining the Miscellaneous Tariff Bill, it is important to understand what tariffs and duties are.
Customs duties are tariffs, or taxes, imposed on goods when transported across international borders.
Each product imported into the U.S. has an established duty rate, based on the country of origin and product components. The duty rate can be impacted by the commercial value of the goods, the weight of the product or the number of items in the shipment.
Importers can find out the designated duty rate for a product by referencing the Harmonized Tariff System (HTS) manual. Many importers also rely on their Licensed Customs Broker (LCB) to help them classify import products.
2. Next, what is the Miscellaneous Tariff Bill (MTB)?
The MTB was passed under the American Manufacturing Competitiveness Act (AMCA) of 2016. It was enacted in May 2016 and allows U.S. importers to submit petitions requesting duty suspension and reduction.
The bill provided the USITC the authority to build a web portal so that it can collect petitions from the trade community, consolidate the responses and submit those to Congress.
Since October 14, companies have been able to file petitions with the USITC for potential duty savings. All petition requests must be submitted to the USITC by December 12, 2016.
After the submission timeframe closes, the USITC will review the petitions and comments. The USITC is then expected to publish a report for Congress by mid-2017. Congress will have 90 days to review, consider and pass the MTB. Passed MTB's will eliminate or reduce the duty on select imported products for three years.
In the past, U.S. importers had to request that Members of Congress introduce bills seeking to temporarily suspend or reduce tariffs on certain imports. The USITC would review and produce reports for Congress on each bill, then the U.S. House of Representatives Committee on Ways and Means and the U.S. Senate Committee on Finance would then combine the individual bills in a single MTB for Congressional consideration. Under the AMCA, filers must now file a petition directly with the USITC.
3. Finally, what is the benefit to U.S. importers and consumers?
The MTB provides importers with the power to request the suspension or reduction of duties on imported intermediate goods that are used in the manufacturing process or finished goods that have limited domestic availability. The trade policy tool limits production costs for American businesses and has the potential to result in savings for both the U.S. producer and consumers.
Learn more in the USITC's MTB Quick Guide here.
For more information about potential duty savings, contact us today.