Tariff Targets Removed for All Countries in DST Retaliation Proposal, All Tariffs Suspended

Every country in the current round of retaliatory tariffs over digital services taxes will have fewer products targeted if negotiations fail to reach a solution, according to detailed lists released for the United Kingdom, Italy, Spain, Turkey, India and Austria. In all cases, as with an earlier list for France, no duties will be collected as negotiations continue. The announcement, made June 2, allows for up to 180 days before a decision has to be made on whether to hike tariffs on these goods by 25%. "Today’s actions provide time for those negotiations to continue to make progress while maintaining the option of imposing tariffs under Section 301 if warranted in the future," U.S. Trade Representative Katherine Tai said in a press release.

The National Association of Beverage Importers, which is affected by other European trade disputes, said the decision not to levy the tariffs creates breathing room to settle the Airbus-Boeing dispute and steel and aluminum tariffs.

The highest value of imports is from the United Kingdom, with 67 subheadings on the list, down two from the initial proposal. In 2019, the total imported value of the list was about $887 million. Next is Italy, with 44 subheadings on the list, down from 59. The import value of the list in 2019 was about $386 million. However, the Italian shoes that Everlane asked to be removed from the list during a public hearing remain a target. Spain sent about $324 million in goods in 2019 across 27 subheadings. The target list was 36 subheadings in the original proposal.

Turkey's target list was reduced by almost a third, from 45 subheadings to 32 subheadings. The interagency panel heard from many carpet importers, but retained a wide variety of carpets on the list. It did remove some unglazed ceramic tiles and natural stone tile, which were also requested for removal by American companies (see 2105060046). The total value of the 32 remaining subheadings was $310 million in 2019.

India's target list shrank from 40 subheadings to 26, with an estimated import value of $119 million in 2019. Public comments convinced the government to remove 17 of the 40 tariff subheadings for Austria, including grand pianos.