Senate Dispute Threatens Higher Import Duties

If Congress doesn’t act quickly to renew the U.S. Generalized System of Preferences, importers will be paying millions more in customs duties, a senior official with the National Retail Federation said Monday.

“We’re sort of back in the 1990s,” said Erik Autor, NRF international trade counsel. Before a GSP renewal in 2002, Congress passed a string of short-term renewals that made it impossible for importers to make long-term sourcing decisions.

By The Numbers: U.S. Foreign Trade.

The generalized system is popular with importers since it allows the duty-free import of selected goods from certain developing nations. The GSP law expired on Dec. 31, and now importers are obligated to pay duties on the same goods. Autor said the consequences could be especially dire for small importers that don’t have the financial resources.

Autor said that the GSP bill before the 111th Congress was blocked by Sen. Jeff Sessions, R-Ala. The Sessions hold was on behalf of an Alabama manufacturer that claimed unfair competition from a company in Kentucky that imported duty free an equivalent product from Bangladesh. Sen. Mitch McConnel, R-Ky., in turn came to the defense of the Kentucky firm.

Autor said the odds are against a GSP renewal until Congress can reach a compromise that will satisfy Sessions.

-- Contact R.G. Edmonson at bedmonson@joc.com.