Hearings In Washington Highlight Tariff Risks For Industry, Businesses And Consumers
Jun 25, 2019
With hearings underway on the U.S. government’s proposed 25 percent tariff on an additional $300 billion in Chinese imports, Ambassador Lighthizer, the U.S. Trade Representative (USTR), testified before the Senate Finance Committee and House Ways & Means Committee on President Trump’s trade agenda.
While most of the discussion during the hearings were about the United States, Mexico, Canada Agreement (USMCA), which Mexico ratified on Wednesday, there were also several questions regarding the tariffs. In his testimony, the USTR defended the use of tariffs but said he did not know if the President will carry through with the threat. The USTR did commit to an exclusion process if list four becomes effective. The White House wants to see meaningful progress from China on several issues, including the theft of intellectual property, the forced transfer of technology, cyber hacking and trade barriers.
Meanwhile, businesses in industries across the U.S. are calling for a swift resolution to the trade dispute with China. Last week, PPAI joined in signing a letter sent by Tariffs Hurt The Heartland, advocating for an end to the tariffs. The letter urged the administration to negotiate a strong deal with China that addresses longstanding structural issues, improves U.S. global competitiveness and eliminates tariffs without taxing Americans.
The USTR is holding hearings through June 25 on the proposed tariff incraese. During the hearings, several businesses and organizations have already submitted statements.
Walmart says that it will be forced to raise prices on consumer goods, noting in the comments it filed with the USTR that the new tariffs "are likely to hit low-income American families the hardest," and sharing data from the consulting firm The Trade Partnership Worldwide LLC, which estimated an average American family of four would pay $2,300 more for goods and services each year, should tariffs go into effect on all imports from China.
In prepared remarks to the USTR, the Semiconductor Industry Association says, "IT firms make up a significant sector of the U.S. economy, and any slowdown in this sector will have a ripple effect through a broad range of other industries, greatly impacting U.S. economic growth."
The American Chemistry Council, whose members include Dow, DuPont and Exxon Mobil, is also set to testify this week. The tariffs would boost the amount of chemical and plastic imports from China subject to tariffs to $26.4 billion. An advance copy of remarks by Ed Brzytwa, ACC's director of international trade, notes, "This would amount to the biggest tax increase that U.S. chemical manufacturers have ever experienced.”