Trade Cases

Passage of New Bill Potentially Gives Manufacturers Relief from Tariffs

Written by Sandy Williams

The American Manufacturing and Competitiveness Act of 2016 was passed by Congress and signed into law on May 20, 2016. The bill H.R. 4923 creates a transparent process for businesses to request duty suspensions and reductions on imported products for which there is no, or insufficient, domestic availability.

The bill calls for regular updates to the Harmonized Tariff Schedule to suspend or reduce duties on goods that affect the competitiveness of American manufacturers.

Businesses can submit petitions directly to the ITC requesting an analysis of duties on specified products. The ITC will solicit comments from the public and from the Administration and submit its recommendations to the Ways and Means committee

Ways and Means will then examine the ITC recommendations and draft a Miscellaneous Tariff Bill (MTB) proposal. The process is transparent and will certify there are no spending earmarks and publish a list of any limited tariff benefits (LTB).

The bill, according to trade attorney Lewis E. Leibowitz (, does not affect steel since the U.S. does not have any tariffs on steel being imported into the United States. He also told SMU that the bill does not protect a company against antidumping and countervailing duty charges.

House Ways and Means Chairman Kevin Brady (R-TX) remarked following passage of the bill by the House:

“This legislation is formally called the Miscellaneous Tariff Bill, or MTB for short. But it makes more sense to think of this as an MTB of another kind – legislation providing “Manufacturing Tax Breaks” – plain and simple.

“Since 2012, American manufacturers have had to pay full tariffs – border taxes, in essence – for certain imported products not made in the U.S., unnecessarily increasing their costs. These tariffs have cost them $748 million annually, and there has been no opportunity for them to get relief from these taxes. These border taxes in turn have made it harder for them to sell their products, grow their business, create jobs, and invest in their communities.”

“By passing this bill today, we’re taking a tremendous step to ensure that we finally have a system in place that helps our manufacturers compete in the global market – and win.”

Phil Gibbs, analyst at Key Banc Capital Markets, commented that the recent trade determinations on corrosion resistant steel imports are stronger than anticipated and “could send a message to U.S. buyers procuring material from nations currently perceived as ‘safe havens,’ including those currently not named in the pending trade cases.”

Said Gibbs in a note to clients, “While we see this outcome as supportive of near-term supply constraints and near-term pricing resilience into 3Q16, particularly for downstream galvanized products, the recent passage of The American Manufacturing and Competitiveness Act of 2016, which puts in place a process to eliminate tariffs on inputs and other products that are not produced or available in the United States, and potential appeals from overseas mills, could challenge the sustainability or enforcement of duties at face. These countermeasures, however, could take some time to enforce.”

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