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Trump knocks down calls for tariff relief

President Trump on Wednesday said there was “no reason” to include tariff relief in his administration’s plan to mitigate the economic impact of the coronavirus pandemic, rebutting calls from many in the business community.

During a White House press conference, Trump was asked about a “major trade coalition … an American free trade group” that is asking the administration to suspend tariffs as part of its response to the coronavirus. The president responded by saying the countries on which duties have been imposed were likely to be behind any tariff-relief push — and reiterating his oft-debunked claim that China, and not U.S. companies, is paying the U.S. billions of dollars in tariffs.

“Who heads that group? Those countries do, probably,” Trump responded. “China pays us billions and billions of dollars in tariffs and there’s no reason to do that.”

Trump added that China had not asked him to lift any tariffs and said he “can’t imagine Americans asking for that, but it could be that China will ask for a suspension or something, we’ll see what happens. China is having a really rough time. This was caused by something totally unrelated to tariffs.”

Americans for Free Trade, a coalition that says it represents every sector of the U.S. economy, on Wednesday sent Trump and other administration officials a letter urging them to include tariff relief among their economic stimulus plans.

Suspending Section 301 and Section 232 tariffs levied throughout the course of the Trump administration “would provide tax relief to millions of American farmers, manufacturers, families, and consumers without having to wait on action from Congress,” Americans for Free Trade wrote.

“These tariffs are taxes that Americans pay,” the coalition noted.

Asked about Trump’s comments, Americans for Free Trade spokesman Jonathan Gold told Inside U.S. Trade the letter “was not sent by the Chinese, it was sent by a coalition of 160 American business associations representing thousands of American businesses and millions of American workers. The letter shares the concerns of US manufacturers, retailers, farmers and agribusinesses who have been paying for tariffs since the President’s trade war began.”

In its letter, AFP cited research done by Trade Partnership Worldwide LLC, which shows that if the administration suspended Section 301 and Section 232 tariffs on Chinese imports, and China lifted its associated retaliatory tariffs, the U.S. economy would be boosted by more than $75 billion. That economic spark would return discretionary income to families, encourage capital expenditure by private companies and instill market confidence, AFP said.

The suspension of tariffs could also be done “quickly and decisively” without having to receive Congressional authorization, AFP said.

Business Roundtable, a group of CEOs that claim to employ more than 15 million people, also advised Trump on Wednesday to implement tariff relief, among other actions, to ensure “a stronger and more rapid recovery.”

“Congress and the Administration should provide immediate tariff relief through the duration of the global pandemic. Tariff relief can support the public health response as well as economic recovery. As an immediate step, the U.S. government should suspend tariffs on all medical and health products and other supplies necessary for the public health response to the COVID-19 outbreak,” BRT wrote.

Others have also called on the administration to suspend tariffs in response to the outbreak.

Citing a “dire need” for canned products among American consumers who are self-quarantining, the Can Manufacturers Institute on Wednesday asked the administration “to place an immediate waiver on tinplate steel tariffs so foreign steel can be imported quickly without the bureaucratic hurdles imposed by tariffs.”

In its statement, the group claimed an “outsized demand” for canned food and disinfectant products was putting a strain on supply chains.

A group of 23 trade associations sent a letter to National Economic Council Director Larry Kudlow last week requesting the “immediate elimination” of Section 301 tariffs as well as refunds of duties imposed on Chinese imports to offset the impact of coronavirus.

“We can think of no other policy tool at the Administration’s disposal that would have such a fast and beneficial impact as the immediate and retroactive removal of these tariffs,” the associations wrote.

U.S Trade Representative Robert Lighthizer, who was also sent the AFP letter, reportedly was not receptive to the idea of tariff relief as a response to the virus when asked about it during a meeting with Democratic members of the House Ways & Means Committee last week.

 

Source: Inside Trade

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