Cost and supply-chain analysis
Section *** of the Trade Act of **** (** U.S.C. §****) limits a balance-of-payments surcharge to *** days unless Congress authorises an extension. President Trump imposed the ** per cent surcharge effective February **, ****, placing its statutory expiry on July **. No extension legislation has advanced. According to US Customs and Border Protection (CBP) guidance, the surcharge applies to goods “entered for consumption or withdrawn from warehouse for consumption” before **:** a.m. EDT on July **. Consequently, the precise customs-entry timestamp determines whether a shipment is subject to the additional ** per cent duty.
The proposed replacement is considerably more significant. In a June *, ****, Federal Register notice (** FR *****), the Office of the US Trade Representative (USTR) proposed additional Section *** duties of ** per cent or **.* per cent on imports from ** economies for failing to enforce prohibitions on forced-labour goods. Unlike Section ***, Section *** contains neither a statutory duty ceiling nor an automatic expiry. As of July **, the proposal has not been finalised, and no determination has been published.
For apparel, the underlying tariff burden is already among the highest in the US tariff schedule. The US International Trade Commission**;s Harmonized Tariff Schedule (HTS) sets Most-Favoured-Nation (MFN) duties on certain cotton knitwear under Chapter ** at up to **.* per cent, while man-made-fibre (MMF) garments attract significantly higher rates. Knitted MMF shirts (HTS ****.**) and MMF T-shirts (HTS ****.**.**), for example, carry a ** per cent MFN duty. Adding a proposed **.* per cent Section *** duty to a **.* per cent MFN cotton garment would raise the combined tariff burden to about ** per cent, compared with the current effective rate of **.* per cent under the temporary Section *** surcharge.
