Tariff Exclusion: How Do I Benefit From Them As An Importer
The certainty of death and taxes is put to the challenge when it comes to tariffs. Thanks to tariff exclusions, not all taxes are unavoidable; but understanding what is excluded and how to benefit from those exclusions is seldom a simple task. With the US-imposed tariffs mounting up to $360bn on Chinese goods and China-imposed tariffs rising over $110bn on US products, the current US-China trade war is in full swing. Now is a good time to familiarize yourself with the tariff exclusion process.
The process of obtaining exclusions from tariffs is detailed here in the official Exclusions Request Form. In plain terms, the process involves four primary requirements: whether your specifics goods are eligible for exclusion, whether the particular product is only available from China and what efforts were made to source from elsewhere, whether the imposition of duties on that product has or will cause severe economic harm, and whether the product is part of the “Made in China 2025” or other similar industrial programs.
The first step for applying for an exclusion is determining whether the goods you have purchased or wish to purchase fall on the exclusion lists. You can apply for refunds on tariffs you have already paid if the products you purchased are on the exclusion lists. These lists have changed over time and the ability to apply for exclusions is time-sensitive.
Where are the Tariff Exclusion Lists?
Lists of goods from China that are eligible for tariff exclusion are provided by the United States Trade Representative (USTR) and are available in PDF form here: List 1, List 2, List 3, and List 4.
So far, over 60 percent of tariff exclusion requests have been denied. You can view the public dockets that show each application and its status on this USTR page. That page also includes a link for submitting your own exclusion request. You will be required to create an account on the USTR website to submit a request for yourself or on behalf of another person, organization, or group.
When applying for exclusion, it’s important to provide a detailed rationale for your request that establishes there are no viable alternative suppliers for the good or product you require. With the number of declined applications rising, it’s imperative that you establish your need while also showing that attempts were made to source the materials from outside China.
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