ITC Issues Revision 4 to 2018 Tariff Schedule; Updates Related to Section 232 Exemptions
The International Trade Commission released Revision 4 to the 2018 Harmonized Tariff Schedule, making several changes related to recently imposed Section 232 tariffs on aluminum and iron and steel products. The updated tariff schedule includes a series of new tariff subheadings in chapter 99 used to administer quotas on South Korean steel that form part of that country’s exemption agreement, as well as new language in the subchapter notes to chapter 99 on the Section 232 tariffs. The changes took effect May 1.
Specifically, new subheadings 9903.80.05 through 9903.80.58 are added for various steel products from South Korea imported in quantities that fall within quantity restrictions detailed on CBP’s website. For now, those subheadings only cover imports from South Korea, though the administration has said quantitative restrictions will be part of any deal reached to avoid Section 232 tariffs (see 1804300026). Press reports indicate Argentina has agreed to quotas in exchange for exemptions on steel and aluminum, as did Brazil for steel, though the latter will remain subject to aluminum tariffs (see 1805020037).
The quota will apply in full aggregate amount, as well as to imports in shorter periods, according to new U.S. note 16(e) to chapter 99: “Imports from any such country in an aggregate quantity under any such subheading during any of the periods January through March, April through June, July through September, or October through December in any year that is in excess of 30 percent of the total aggregate quantity provided for a calendar year for such country, as set forth on the Internet site of CBP, shall not be allowed.”
Subheadings 9903.80.05 and 9903.85.01 continue to apply to iron and steel imports from all countries except South Korea and aluminum exports from all countries, respectively. Those subheadings also include in their terms a list of countries exempt from the tariffs but not yet subject to quotas: the European Union, Canada, Mexico, and Australia. Argentina and Brazil are also listed (Brazil for steel only), though that looks set to change given the recent reports of agreement.
New U.S. notes 16(a) and 19(a) to chapter 99 for steel and aluminum tariffs, respectively, also clarify the application of special tariff treatment to Section 232 goods. For products eligible for special tariff treatment, “the duty provided in this heading shall be collected in addition to any special rate of duty otherwise applicable,” the notes say. Goods will still be eligible for special provisions in chapter 98, except for subheading 9802.00.60, where “duties shall be assessed based upon the full value of the imported article.” Duty reductions under chapter 99 don’t apply, but additional duties in chapter 99 on top of the Section 232 “shall be imposed,” it says.
The ITC’s tariff schedule webpage continues to cite problems with links to CBP rulings following the latter agency’s update of its online rulings database (see 1804180057). “Due to a recent update to the Customs Rulings Online Search System (CROSS), the links provided to the CROSS rulings in the HTS Search results are not functioning. We are actively working to resolve this problem as quickly as possible,” it says.