Recent Update to Section 301 Tariffs

On May 22, 2024, the U.S. Trade Representative (“USTR”) published a Federal Register Notice (“FRN”) regarding proposed modifications to tariffs imposed on Chinese-origin steel under Section 301 of the Trade Act of 1974 (“Section 301”). The FRN provides details on last week’s announcement from the White House where President Biden directed USTR to increase tariffs on $18B of certain Chinese-origin products, listing the 382 HTSUS subheadings and 5 statistical reporting numbers targeted by the proposed tariffs.

The tariffs are scheduled to go into effect on varying timelines starting in 2024 and continuing into 2026. Increases in 2024 will be effective August 1, 2024, and increases in 2025 and 2026 will be effective January 1st of each year. The notice requests public comments on the proposed modifications with a deadline of June 28, 2024.

Proposed Modifications

The proposed modifications will either add new or increase Section 301 tariffs on specific products within the following strategic sectors:

  1. Steel and Aluminum
  2. Semiconductors
  3. Electric Vehicles
  4. Batteries and Battery Components and Parts
  5. Critical Minerals
  6. Solar Cells
  7. Ship-to-Shore Cranes
  8. Medical Products

Tariff rates for HTS codes in these sectors are increasing to between 25% and 100%. A listing of all impacted HTSUS subheadings and statistical reporting numbers can be found in Annex A of the FRN.

Proposed Exclusions for Certain Machinery

In addition to the proposed modifications to the Section 301 tariffs, the FRN details a new tariff exclusion request process for certain machinery used in domestic manufacturing and classified within prescribed HTSUS subheadings, listed in Annex B of the same FRN. The exclusion process will allow eligible products to be excluded from the Section 301 tariffs through May 31, 2025, if approved.

USTR also published a separate list of 19 temporary exclusions for solar manufacturing equipment, which will be effective through May 31, 2025 (see Annex C).


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