Tariff exemptions for US products 
2019-09-12
CHINA announced its first batch of tariff exemptions for 16 types of US products, days ahead of a planned meeting between trade negotiators from the two countries to try and de-escalate their bruising tariff row.
Cancer drugs, lubricants, pesticides, shrimp meal and a number of other products will be excluded from a list of American goods subject to tariffs, China’s Ministry of Finance said in a statement on its website.
Specifically, 16 items in the list will be exempted from tariffs imposed in retaliation for US tariffs as part of a “Section 301” probe, starting from September 17, 2019, to September 16, 2020.
The Customs Tariff Commission of the State Council will offer refunds for 12 items that have already been taxed, including shrimp, lubricant, fish meal (used in animal feeding), and medical linear accelerators, which are used in cancer treatment. Related companies have six months to file refund applications to China’s customs administration.
The remaining four items will also be free from the tariffs, but there will be no refund for the previously-added duties.
The four products on the list are whey (used in animal feeding), mold release agents, isoparaffin solvent and lubricating base oil.
The commission will continue to carry out the exemption process for the third round of additional tariffs on US imports worth US$75 billion.
The United States is by far China’s largest supplier of whey, which is an important ingredient in piglet feed and difficult to source in large volumes from elsewhere.
China has imposed several rounds of duties on US goods in retaliation against US Section 301 tariffs, beginning last year in July and August with a 25 percent levy on about US$50 billion of US imports.
In all, the world’s two largest economies have slapped tariffs on hundreds of billions of dollars worth of goods in a bitter trade war that has dragged on for well over a year and raised the specter of a global recession.
The items on the two tariff exemption lists, posted on the ministry’s website, will not be subject to additional duties imposed by China on US goods “as countermeasures to US Section 301 measures,” the ministry said in its statement.
The exemption will take effect on September 17 and be valid for a year through to September 16, 2020, it said.
The list comes ahead of scheduled talks next month between China’s top trade negotiator, Liu He, and senior members of the Trump administration US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin in Washington.
Reaching a deal will be tough, however.
Trump has already said he would raise tariffs to 30 percent from 25 percent on US$250 billion in Chinese goods, including everything from cars to aircraft parts, on October 1.
The United States had also exempted imports of 110 Chinese products from tariffs in July, including high-value products such as medical equipment and parts.
Earlier yesterday, a survey by a prominent American business association showed the trade war is souring the profit and investment outlook for US companies operating in the world’s second-biggest economy.
