China Tariffs May Stay in Place Even if a Deal is Reached to End the Trade War

President Trump has warned that U.S. tariffs on $250 billion worth of Chinese goods may stay for ‘a substantial period of time’ – even if the two countries reach a deal to end the trade war.

“We’re not talking about removing them.  We’re talking about leaving them for a substantial period of time,” Trump said last week. “Because we have to make sure that if we do the deal with China, that China lives by the deal because they’ve had a lot of problems living by certain deals.”

Steven Mnuchin, U.S. Treasury Secretary, and Robert Lighthizer, U.S. Trade Representative, are in China this week for the latest round of high-level talks after a weeks-long hiatus.  Negotiations were put on hold while Washington pursued commitments from Beijing to change its trade practices, including better protection of intellectual property, ending the forced transfer of technology in joint ventures, and increasing access to China’s markets.

In an attempt to address those concerns, Beijing recently rushed through a new foreign investment law that will better protect foreign businesses operating in China.  The law, passed earlier this month, includes better safeguards for protecting intellectual property rights and puts an end to the practice of forcing foreign companies to hand over critical technology to their partners in China.

In a goodwill attempt earlier this month, Trump postponed the planned tariff increase from 10% to 25% on $200 billion worth of Chinese imports.

Chinese officials could follow-up with a visit to Washington in early April and presidents Trump and Jinping are aiming for a summit meeting late in April to hopefully sign a deal.

More Section 301 Exclusions Announced

The Office of the U.S. Trade Representative announced Section 301 tariff exclusions for 33 products late last week.  The granted exclusions pertain to the 25% tariff on List 1 covering $34 billion worth of Chinese goods and will apply retroactive to July 6, the effective date of the $34 billion action.  The exclusions will be valid for one year (through March 25, 2020) following publication of the Federal Register Notice.

These new exclusions take the form of three 10-digit Harmonized Tariff Schedule subheadings and include 30 specific product descriptions.  The subheadings for which the tariffs do not apply are:

  • 21.0045
  • 31.0040
  • 21.1000

For a complete list of the 30 product exclusions, please click here.

The USTR notes that the exclusions are available for any product that meets the description in the Annex to the Federal Register notice, regardless of whether the importer filed an exclusion request.

CBP issued the following guidance for filing entries subject to the product exclusions:

In addition to reporting the regular Chapters 84, 85 and 90 classification for the imported merchandise, filers shall report the HTSUS classification 9903.88.06 (Articles the product of China, as provided for in U.S. note 20(i) to this subchapter, each covered by an exclusion granted by the U.S. Trade Representative) for imported merchandise subject to the exclusion.

Filers are advised not to submit the corresponding Chapter 99 HTS number for the Section 301 duties when HTS 9903.88.06 is submitted.

To request a refund for previous imports of duty-excluded products granted by USTR, importers can file a Post Summary Correction (PSC) following the same entry filing instructions above, dating back to July 6, 2018.  If the entry has already been liquidated, importers may protest the liquidation.

CBP also noted that questions from the importing community concerning Automated Commercial Environment entry rejections involving product exclusion numbers should be referred to their CBP client representative, and questions related to Section 301 entry filing requirements should be emailed to

The USTR has not granted any exclusions on the 25% tariffs imposed on List 2, affecting $16 billion worth of Chinese imports, nor have they established an exclusion process for the 10% duties on List 3 of $200 billion worth of Chinese goods.



  • CNN
  • Reuters
  • Sandler, Travis & Rosenberg Trade Report
  • South China Morning Post
  • American Shipper
  • Federal Register
  • U.S. Customs and Border Protection