Trump Asks Agencies to Examine Global Tariff, de Minimis, Section 232 Exclusions, China Tariffs, More
On his first day in office, the president directed the heads of agencies that deal with trade, tariff collection and trade remedies to:
- Investigate the causes of "our country’s large and persistent annual trade deficits in goods," and recommend policies to remedy them, such as a global supplemental tariff
- Identify unfair trade practices and recommend remedies, such as banning the import of goods when other countries don't allow U.S. imports of similar goods
- Assess how de minimis should be modified to protect revenue and public health by preventing the import of contraband drugs and counterfeit products
- Review last year's Section 301 review that hiked tariffs on some goods to 100% and added new targets, to consider additional tariff modifications "particularly with respect to industrial supply chains and circumvention through third countries"
- Investigate other Chinese acts other than those targeted in the Section 301 investigation that burden U.S. commerce and recommend appropriate responses
- Evaluate whether China is living up to the Phase 1 agreement, and recommend a response, including tariffs
- Review the effectiveness of country exemptions, tariff rate quotas and tariff exclusions for Section 232 actions on steel and aluminum, and make recommendations on those exceptions
- Assess bills to end Permanent Normal Trading Relations with China and make recommendations on changes to those bills
- Assess whether a new Section 232 investigation is warranted to protect any part of the U.S. industrial and manufacturing base
- Review the final rule on connected vehicles and consider whether additional connected products should be covered
- Review regulations on antidumping and countervailing duty laws, "including with regard to transnational subsidies, cost adjustments, affiliations, and 'zeroing.'" Also, assess whether the procedures for verifications are sufficient to convince foreign companies and governments to comply in AD/CVD proceedings, and modify them if not.
- Review existing free trade agreements and sectoral trade agreements and recommend revisions necessary to achieve or maintain reciprocal concessions
- Identify countries to begin trade negotiations with, either for comprehensive FTAs, or sector-specific agreements "to obtain export market access for American workers, farmers, ranchers, service providers, and other businesses."
Although the commerce secretary, U.S. trade representative, homeland security secretary and treasury secretary have not yet been confirmed, Trump directed them to report to him on these issues by April 1. Treasury secretary nominee Scott Bessent was recommended by the Senate Finance Committee for a vote in the full Senate in a 16-11 committee vote Jan. 21, with two Democrats joining all the Republicans in supporting his nomination. DHS nominee Kristi Noem also received bipartisan support in the Homeland Security committee, with a 13-2 vote, with five Democrats joining all Republicans in supporting the South Dakota governor's nomination. The commerce secretary nominee and USTR nominee have not had hearings scheduled yet.
House Ways and Means Chairman Rep. Jason Smith issued a lengthy statement responding to the memo, saying, "President Trump has wasted no time in demanding better treatment of American workers and businesses, as the American people clearly voted for him to do."
The Missouri Republican said that evaluating all the ways "to address persistent trade deficits, including a potential global tariff on imported goods, is a prudent approach that will give the Administration time to analyze the most effective new policies...."
He said he was pleased that the administration would review current free trade agreements to see if they "are working as intended," and that the administration is thinking of negotiating new agreements.
"For far too long, other countries have felt free to impose unfair tariffs, taxes, and non-tariff barriers against American exports and businesses. The success and necessity of existing tariff policies like those established during President Trump’s first administration provide valuable lessons into how we can strategically deploy trade policies to sharpen our nation’s competitive edge, demand more reciprocal access to foreign markets for American goods, and protect our national security -- including the emergency of our unsecured border and the fentanyl crisis that is poisoning Americans," he said.
He said he believes China's permanent normal trade relations status should be examined, and said, "It is past time to hold China accountable for its failures to live up to its obligations under [the phase one] agreement."
The American Iron and Steel Institute thanked Trump for re-evaluating the Section 232 action exceptions. "We urge the new administration to take active steps to reinvigorate that program to ensure it is meeting the objectives originally established by President Trump during his first term," the trade group said.