White House Renews Plan for Section 301 Tariffs on Goods From China

The White House will resume plans to impose 25 percent tariffs on some $50 billion worth of goods from China, it announced on May 29. The announcement came slightly over a week after the Trump administration said it would put the Section 301 tariffs on hold while the U.S. and China formalize a deal between the countries (see 1805210029). A final list will be announced by June 15 and "tariffs will be imposed on those imports shortly thereafter," the White House said.

The White House also announced additional steps it will take to "protect domestic technology and intellectual property, stop noneconomic transfers of industrially significant technology and intellectual property to China, and enhance access to the Chinese market." The U.S. will "request that tariffs and taxes between the two countries be reciprocal in nature and value" and will work toward "resolving long-standing structural issues and expanding our exports by eliminating China’s severe import restrictions," the White House said.

New "investment restrictions and enhanced export controls for Chinese persons and entities related to the acquisition of industrially significant technology" are also coming, it said. "The proposed investment restrictions and enhanced export controls will be announced by June 30, 2018, and they will be implemented shortly thereafter." The White House said in a fact sheet that "China has consistently taken advantage of the American economy with practices that undermine fair and reciprocal trade."

A spokesman for China said the country was "surprised at the strategic statement issued by the White House," according to an informal translation of a Chinese Ministry of Commerce news release. "This is obviously contrary to the consensus reached between the two sides in Washington not long ago. No matter what measures the United States takes, China has confidence, ability, and experience to safeguard the interests of the Chinese people and the country’s core interests. China urges the United States to act in accordance with the spirit of the joint statement."

The US-China Business Council said such measures are unnecessary. "We would like to see both sides put the threat of sanctions on hold and quickly get into negotiations to resolve these important issues," USCBC President John Frisbie said in a statement. "Tariffs and restrictions on commerce will have a real and negative impact on the economy and jobs. We need solutions that will put the trade relationship on a sounder path for mutual prosperity, not sanctions that will do more harm than good. We encourage both sides to use the coming weeks to achieve that goal."

The U.S. Chamber of Commerce is similarly worried and said in a news release the tariffs are "in fact a tax on American consumers and will undermine the competitiveness of American companies, just as the administration’s steel tariffs have dramatically raised prices on steel." The Retail Industry Leaders Association complained of the rapid change in direction. "Conflicting messages coming from the Administration is causing whiplash for American companies that are focused on growing the economy and creating jobs here at home," said Hun Quach, vice president of international trade for RILA, in a statement.