On August 23, 2019, the People’s Republic of China’s Ministry of Finance (MOF), State Council Tariff Commission (SCTC) announced new tariffs on certain U.S. products, valued at $75 billion USD. The announcement includes two lists; List 1 is to be implemented on September 1, 2019 and List 2 is to be implemented on December 15, 2019. Additional tariffs of 10 and 5 percent are applied to the harmonized schedule tariff lines on each list. Many of these products are also subject to earlier tariff increases by China.1 This brings the total number of U.S. agricultural and related products targeted by additional Chinese tariffs since April 2018 to over 1,000 products, valued at approximately $22.6 billion in 2017. The increased tariffs will be calculated in aggregate with earlier additional tariffs.2
1 See GAIN Report CH18034 China Responds to U.S. 301 Announcement with Revised Product List; GAIN Report CH18047, China Updates List of U.S. Products Subject to Additional Tariffs; and GAIN Report CH19030, China Raises Tariffs on U.S. Agricultural Products.
2 Note: This report replaces GAIN Report CH19051 and contains revisions to some MFN tariff rates listed in the Appendices.
On August 23, 2019, the People’s Republic of China’s Ministry of Finance (MOF), State Council Tariff Commission (SCTC) released Announcement #4, setting out new tariffs for certain U.S. products. These tariffs are in addition to the tariffs that were in place as of June 1, 2019 (the date of the last tariff action by China). In the announcement, MOF says that these new tariffs are in response to the U.S. tariffs announced on August 15, 2019. The Chinese announcement contains 2 lists, each divided into four separate parts, indicating 10 or 5 percent tariff increases. MOF stated that these new increases are intended to affect over $75 billion worth of U.S. exports to China. The first list went into effect on September 1, 2019 and the second is planned for December 15, 2019.
For agriculture, these new tariffs affect over 1000 lines of agricultural and related products. This includes fisheries and forestry products. While many U.S. agricultural and related products were already assessed additional tariffs through previous SCTC announcements, there are many products that are being assessed additional tariffs for the first time. The table below shows the chronology of Chinese tariff announcements.
The agricultural and related products included in the August 23 announcement encompass a broad range of categories, including live animals and animal products, horticultural products, grains and oilseeds, cotton seeds, food ingredients, prepared foods, wine and distilled spirits, and sweeteners.
This GAIN report contains an unofficial translation of the August 23, 2019 announcement, separate tariff schedules for U.S. agricultural products (Appendix 1), fisheries products (Appendix 2), and forestry products (Appendix 3) impacted by each round of additional tariffs. Each table includes:
1. The affected harmonized schedule tariff code
2. An English translation of the Mandarin product descriptions
3. The Most-Favored-Nation (MFN) tariff rate or Provisional tariff rate
4. Additional tariffs in response to the U.S. 232 Investigation (if any)
5. The total tariff rates related to the U.S. 301 Investigation (if any)
6. The new tariff increases that will enter force on September 1, 2019 (if any)
7. The new tariff increases that will enter force on December 15, 2019 (if any),
8. And the total aggregate tariffs for all products calculated for December 15, 2019, should these new tariffs enter into force.
The appendices do not include Value-Added Tax (VAT) rates, which are beyond the scope of this report.
Disclaimer: This summary is based on a review of the Chinese announcement and therefore should not, under any circumstances, be viewed as a definitive reading of the regulation in question, or of its implications for
U.S. agricultural export trade interests. In the event of a discrepancy or discrepancies between this summary and the complete regulation or announcement as published in Mandarin, the latter shall prevail.
Announcement Link: http://m.mof.gov.cn/czxw/201908/t20190823_3372928.htm
UNOFFICIAL TRANSLATION OF MINISTRY OF FINANCE ANNOUNCEMENT
State Council Tariff Committee Announcement on“Increasing Tariffs on Some Products Originating In the United States (Third Batch)” Tariff Committee Notice  No. 4
On August 15, 2019, the U.S. government announced imposing 10 % tariff on the USD 300 billion list of goods imported from China. The tariff will be enforced in two batches starting on September 1, 2019 and December 15, 2019, respectively. The U.S. measures have led to an escalation of Sino-U.S. economic and trade frictions, greatly jeopardizing the interests of China, the United States, and other countries, and seriously threatening the multilateral trade mechanism and free trade principles.
According to the “People’s Republic of China Customs Law”, “People’s Republic of China Foreign Trade Law”, “People’s Republic of China Import and Export Tariff Regulations” and other laws and regulations and the basic principles of international law, the State Council Tariff Committee decided to increase tariffs on the products originating in the United States totaling 5078 tax items and about USD 75 billion. The relevant matters are hereby announced as follows:
- From 12:01 of September 1, 2019, 270 tax items listed in Annex 1 Part 1 shall be subject to a 10 % tariff, 646 tax items listed in Annex 1 Part 2 shall be subject to a 10 % tariff, 64 tax items listed in Annex 1 Part 3 shall be subject to a 5 % tariff, 737 tax items listed in Annex 1 Part 4 shall be subject to a 5 % tariff. Detailed product scope please see Annex 1.
2. From 12:01 of December 15, 2019, 749 tax items listed in Annex 2 Part 1 shall be subject to a 10% tariff, 163 tax items listed in Annex 2 Part 2 shall be subject to a 10 % tariff, 634 tax items listed in Annex 2 Part 3 shall be subject to a 5 % tariff, 1,815 tax items listed in Annex 2 Part 4 shall be subject to a 5 % tariff. Detailed product scope please see Annex 2.
3. For imported goods originating in the United States listed in the Annex, the corresponding tariffs shall be imposed on the basis of the current taxation method and applicable tariff rates. The current in-bond tariffs and tariff-reduction (exemption) policies will remain unchanged. The tariff imposed this time will not be reduced or exempted.
4. The calculation of relevant import taxes:
Adding tariff = duty paid price × additional tariff rate Tariff = current applicable tariff + additional tariff
The import value-added tax and consumption tax shall be calculated in accordance with relevant laws and regulations.
Annex 1. List 1 Annex 2. List 2
The State Council Tariff Committee August 23, 2019
END UNOFFICIAL TRANSLATION
Appendix 1 – Schedule of tariffs on U.S. agricultural products (we deliberately do not enclose the Appendix in details).