Biden Eyes Changes to Mainland China Tariffs but Senators Say They Should Stay

A bi-partisan group of senators is urging President Biden not to roll back the Section 301 tariffs on imports from mainland China even as he is considering changes as a way to ameliorate rising domestic inflation.

During a recent trip to Asia Biden said the mainland China tariffs are “under consideration,” reiterating comments made by other senior administration officials in recent weeks. The Office of the U.S. Trade Representative recently launched a statutorily-required review of the tariffs, some of which are scheduled to expire this summer. USTR said it would continue the tariffs if it received a request to continue them and several such requests appear to have already been filed. Once that step is taken USTR will undertake a separate review that could result in changes to the tariffs but is likely to take months to complete.

In the meantime, nine senators from both major parties sent a letter to Biden on 25 May urging him to “substantially maintain the tariffs in their current form.” Rolling back the tariffs “would undermine the U.S. position in negotiations” with mainland China, they said (although no such negotiations appear to be currently underway), as well as “expose many U.S. companies and workers to a sudden flood of imports” (although U.S. imports from mainland China are already high and continuing to increase despite the presence of the tariffs).

Lowering the tariffs would also signal to mainland China “that waiting out the United States is preferable to changing their non-market behaviour or complying with the Phase One Agreement,” the senators said. This would be particularly damaging at a time when mainland Chinese actions, from repression of ethnic minorities to restrictions on Hong Kong to continued support of Russia, have raised “grave concerns about the long-term future of U.S.- China relations.”

Instead, the senators said, the U.S. should use the enforcement tools guaranteed by the phase one agreement “to make clear that we are serious about rectifying its violations.” Failure to do so would “only make it more difficult to make progress with China on the subsidies, state-owned enterprises, suppression of labour rights, and other unfair behaviours that are the core of the structural obstacles to a level playing field in bilateral trade.”