August ’23 at-a-glance … taxes, tariffs & trade

U.S. – EU continue negotiations to avoid return of Section 232 tariffs

Negotiations continue between the U.S. and EU to reach agreement before the Oct. 31  expiration of the tariff rate quota (TRQ) that replaced the Section 232 steel and aluminum tariffs. The U.S. proposed replacing Section 232 tariffs with new carbon border adjustments, but the EU has resisted because it prefers its own Carbon Border Adjustment Mechanism and does not believe the U.S. proposal is World Trade Organization (WTO) compliant. If no deal is reached by the deadline, Section 232 steel and aluminum tariffs and EU retaliatory tariffs could be reinstated in January 2024, and, under EU law, the EU retaliatory tariffs would double to 50 percent. According to the Coalition of American Metal Manufacturers and Users (CAMMU), of which NAFEM is a member, most observers believe that there will be some kind of temporary extension of the TRQ deal if no agreement is in place.

House proposal would require congressional approval of Section 232 tariff adjustments

The bipartisan Congressional Trade Authority Act introduced in the House would require congressional approval to any presidential proposal to adjust Section 232 imports in the interest of national security. Under the proposal bill, Congress would have 60-days to review the president’s proposal. The requirement would apply to all future Section 232 actions, in addition to those taken within the last six years. The bill also would restore the national security intent behind Section 232 by transferring national security investigatory authority from the Department of Commerce to the Department of Defense.

The bill is similar to the proposed Global Trade Accountability Act introduced in March by Republican Senators that would require congressional approval of any unilateral trade actions by the president before they take effect.