Today, Reps. Mike Thompson (CA-05), Brad Wenstrup (OH-02), and Terri Sewell (AL-07) introduced the FAIR TARIFF Act to improve how the United States Trade Representative (USTR) administers tariffs. This legislation would give U.S. companies fair warning of at least 60 days before retaliatory tariffs are imposed on goods.
"When tariffs are imposed on goods in transit, American importers are hurt," said Thompson. "The FAIR TARIFF Act will ensure that any penalties are enforced on foreign exporters, rather than American importers. I am proud to introduce this bipartisan bill with Reps. Wenstrup and Sewell to ensure that American companies do not pay any penalties for having goods in transit when tariffs are imposed."
"This bill will provide clarity and certainty for U.S. companies, so they are not surprised with a large tax bill on goods they ordered before tariffs were even announced," said Wenstrup. "Increasing tariffs is one tool we have to compel foreign governments to end unfair trade practices. This legislation ensures that when the U.S. uses this powerful tool, our tariffs target foreign producers, as intended, rather than U.S. importers."
"Alabama workers and consumers deserve to have trade laws that are balanced and fair," said Sewell. "The bipartisan Fair Tariff Act is a common sense bill that modernizes our trade laws to ensure that tariffs are not placed on goods already in transit. As a member of the Ways and Means Committee I will continue to advocate for the Fair Tariff Act and other legislation that creates a more equitable trading system."
"If tariffs must be used, we should do what we can to protect American businesses, manufacturers, and jobs from the negative impact. In a globalized economy, giving small businesses ample notice of tariffs on their imported inputs is essential," said Rep. Adrian Smith (R-NE), Lead Republican on the Ways and Means Trade Subcommittee. "The Fair Tariff Act is a commonsense measure to better equip U.S. importers to make purchasing decisions. The bill would also ensure USTR cannot rush to implement tariffs without giving U.S. companies adequate time to prepare while also rectifying instances these tariffs have negatively impacted American businesses. I thank Rep. Wenstrup for his work on this important bill."
Original cosponsors of this legislation include Reps. Mike Thompson (D-CA), Brad Wenstrup (R-OH), Terri Sewell (D-AL), Adrian Smith (R-NE), Dwight Evans (D-PA), and Carol Miller (R-WV).
In May 2019, when USTR published 25 percent tariffs on $200 billion worth of products from China, U.S. companies clamored for, and received, a "goods on the water" exemption. USTR did not provide such an accommodation for the two most recent sets of retaliatory tariffs, the 25 percent tariffs on European wine, spirits, food, and other products implemented in October 2019 and expanded in January 2021. In both these cases, tariffs were implemented with less than two weeks' notice, and the pleas of U.S. companies for a "goods on the water" exemption were ignored. The FAIR TARIFF Act would direct USTR to provide U.S. companies adequate time to land goods from market economies in transit before retaliatory tariffs begin, and would also refund "goods on the water" tariffs paid following the rapid implementation of the two most recent sets of retaliatory tariffs, except those goods tied to the underlying dispute.