Miscellaneous Tariff Bill (MTB) Duty Rates Effective October 13, 2018
The Harmonized Tariff Schedule was amended on October 13, 2018 to implement the Miscellaneous Tariff Bill Act H.R. 4318 (MTB), which was signed into law on September 13, 2018. The MTB will temporarily reduce or eliminate tariff rates for approximately 1,700 products. These reduced rates apply to subject goods entered, or withdrawn from warehouse for consumption, on or after October 13, 2018 and will remain in effect until December 31, 2020.
Any U.S. Importer can take advantage of the duty savings under the MTB, which are reductions to the Normal Trade Relation (NTR) rates of duty. Although the MTB provides duty savings on imported product, many products are still subject to the Section 301 additional duties if manufactured and imported from China. For those products subject to both the MTB and the Section 301 China duties, the importer will receive a reduction or elimination of NTR or “normal” duties, but still be subject to the additional 10% or 25% duty under Section 301. In these cases, the MTB will provide some relief from the 301 duties. For instance, if a product is subject to a 5% “normal” duty rate and the 25% 301 duty rate, but the MTB reduces the “normal” duty rate to 1.5%, the importer will pay 26.5% in duties rather than 35% in total duties.
Products subject to the MTB were recommended by the International Trade Commission (ITC) and are products, or inputs, not produced in the United States. Originally introduced in 1982, the MTB is intended to temporarily remove economic burdens to U.S. Manufactures by reducing costs. As the MTB is only temporary, and manufacturers must petition for relief every three years, the MTB is intended to incentivize manufacturers to build capacity to manufacture in the United States.
The MTB is typically reviewed and renewed every three years; however, the previous bill expired in 2012. With delays in passing this round of the MTB, the temporary duty reductions will only be in place for a little over two years. In 2016, Congress passed the American Manufacturing Competitiveness Act to establish an open and transparent process for approval of the Miscellaneous Tariff Bill. Through this process, manufacturers can start submitting requests to the ITC for the next MTB duty suspension in October of 2019.
Please reach out to M.E. Dey to review your products for possible MTB savings.