Trump Tweet Threat to Hike Tariffs Friday to 25% Draws Tech Opposition
Industry reacted against President Donald Trump’s surprise tweets Sunday threatening to hike to 25 percent the Section 301 tariffs currently at 10 percent on $200 billion in Chinese imports, effective this Friday. The uproar overshadowed industry’s response to Trump’s accompanying threat to impose 25 percent tariffs “shortly” on $325 billion more in Chinese goods previously “untaxed.” That would cover virtually all remaining imports to the U.S. from China.
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A tariff hike on five days’ notice “would roil our markets, damage U.S. businesses and do serious harm to Americans' retirement funds and pensions," said CTA President Gary Shapiro. The group said that “Tariffs Are Taxes.” The Information Technology Industry Council warned that the levies “would only continue to harm American consumers and businesses of all sizes and across all sectors,” said Naomi Wilson, ITIC senior policy director-Asia. Threats to hike the tariffs “at this juncture in the negotiations” with China could imperil “the important progress both sides have made” toward reaching a comprehensive trade accord, she said.
Current 10 percent duties “are hurting American technology companies and an increase will only do more harm to businesses and consumers who rely on technology to improve their lives at home and work,” said Stefanie Holland, CompTIA vice president-federal and global policy. “We encourage the U.S. and China to continue negotiations in order to strike a deal that protects American technology companies and does not punish consumers.”
The Trump administration "appears to be overly anxious to get a ‘win' on international trade,” said Computer & Communications Industry Association CEO Ed Black. “We are concerned they may throw key tech issues overboard in an effort to get a quick deal with China." The U.S. “may not soon have another chance” at a comprehensive trade deal that properly addresses "21st century" internet and digital trade issues “if we don't get it right,” he said.
Unclear is the fate of negotiations in Washington that the White House previously said would take place Wednesday. The White House was silent Monday, as was U.S. Trade Representative Robert Lighthizer, who with Treasury Secretary Steven Mnuchin, led the U.S. delegation last week in Beijing.
Trump’s tweet doesn’t have the force of law to make a tariff increase effective Friday without a USTR notice in the Federal Register. Customs expert Ted Murphy with Baker & McKenzie advises viewing Trump’s “bombshell” threat in the “context” of seeking negotiating “leverage” now that the trade talks “may be down to the final stages,” he blogged Sunday.
The “pressing task at the moment” is for the U.S. to “work with China to meet each other halfway” and strike a “mutually beneficial” agreement, said a Foreign Ministry spokesperson Monday: “The Chinese delegation is preparing to travel to the U.S.” for “the next round of consultations.”