Beginning Feb. 7, 2018, additional tariffs will be assessed on imports of washing machines, washing machine parts, and solar panels in the government’s latest effort to give a competitive edge to domestic producers of these products. The safeguard tariffs come after the International Trade Commission (ITC) found that an increase in foreign imports of washing machines, in whole and in part, and solar cells and modules, were causing substantial injury to domestic producers.
U.S. Trade Representative (USTR) Robert Lighthizer made recommendations for domestic relief to the President based on the ITC’s findings and consultation with the Trade Policy Committee, and President Trump subsequently approved the measures on Jan. 22, 2018. The next day, President Trump issued the proclamations imposing the global safeguard tariffs on imported washers, washer components, and crystalline silicone photovoltaic cells (solar cells).
The power to impose the tariffs derive from Section 201 of the Trade Act of 1974. When the ITC finds that an increase in imports is the substantial cause of serious domestic injury, this section gives the President the authority to respond in the form of tariffs, tariff rate quotas, and quantitative restrictions, among other measures.
The ITC initiated its inquiry after several domestic producers of washing machines and solar panels filed petitions for relief with the U.S. Department of Commerce. For more information about the timeline of events and the ITC inquiries, visit here.
The new tariffs on residential washing machines and washing machine parts will start at 20 percent for the first 1.2 million imported washing machines in the first year, rising to 50 percent on subsequent imports of finished washers. The following chart outlines the tariff-rate quotas on washers for the next three years:
The new tariff on solar panels imports will be 30 percent in the first year, declining 5 percent each year for the next four years. The following chart outlines the tariffs on imported solar cells and modules for the next four years:
Important: The new global safeguard tariffs are different and separate from current antidumping and countervailing duty orders on Chinese solar products and might serve as an answer to circumvention that involved Chinese manufacturers moving production to nearby countries. According to a USTR press release, the USTR plans on engaging interested parties in a discussion of potential fair resolutions to the current ADD/CVD orders on Chinese solar products and U.S. polysilicon. Read more here.