Since 1982, nearly every Congress has passed legislation to temporarily reduce or suspend tariffs on certain imported products and make technical corrections to U.S. tariff laws. Although the official title of the bill varies from year to year, it is usually referred to simply as the Miscellaneous Tariff Bill ("MTB") The duty suspensions and reductions are designed to boost the competitiveness of U.S. manufacturers by lowering the cost of imported inputs without harming domestic firms that produce competing products. In addition, in the case of finished goods, MTBs similarly reduce costs for consumers where there is no domestic production and thus no impact on domestic firms. Overall, the tariff relief contained in MTBs is designed both to be broadly available to any entity that imports and pays duties pursuant to the specified tariff heading and to benefit downstream producers, purchasers, and consumers.
In recent years MTBs have been harder to pass because some members of Congress, particularly in the Senate, have tried to insert controversial items or have held up non-controversial items pending the resolution of other trade-related disputes. Since the 110th Congress the MTB has faced opposition from some Senators and Members of Congress who construe a temporary duty suspension as an inappropriate congressional "earmark."
Background on the 3-Step MTB Process:
First, the new process would begin exclusively through petitions made by local U.S. businesses to the independent, non-partisan International Trade Commission ("ITC"). After the ITC receives petitions from the business community, an independent panel would receive comments from the public and the Administration and conduct its analysis.
Second, the ITC would issue a public report to Congress with its analysis and recommendations regarding products that meet the MTB standards, including that there is no domestic production.
Third, the Ways and Means Committee would examine the ITC’s recommendations and draft a MTB proposal. While the Committee can exclude products from its final proposal, it cannot add products that were not recommended by the ITC. As required by House rules, Ways and Means would certify that there are no spending earmarks and would publish a list of any Limited Tariff Benefits (LTB). Congress would then consider the MTB within existing rules.
Agathon Associates is preparing guidance for clients on how to file for tariff suspensions.