When February 14 rolls around every year, very few people think about expired trade programs. But perhaps they should. In particular, Members of Congress should take a moment to realize how allowing programs like GSP to remain expired can increase costs on what should be one of the sweetest days of the year.
Don’t get us wrong: Valentine’s Day can still be sweet without GSP, it just may be a little more expensive.
Take candies and confections: more than $325 million in sugar candies and chocolates claimed GSP preferences in 2013. Had the program not expired on July 31, American companies would have saved $9.3 million. Not only is the National Confectioners Association one of nearly 500 American organizations on the GSP supporter list, so are number of other candy importers such as Albert’s Candy (Stamford, CT), FAZ Marketing (Houston, TX), Fusion Gourmet (Gardena, CA), Haribo (Baltimore, MD), Jelly Belly (Fairfield, CA), Oppenheimer Chocolates (Brooklyn, NY), and the Palmer Candy Company (Sioux Falls, IA). The import tax currently being charged on candies ranges from 4.0 percent to 6.0 percent.
It’s not just finished products whose prices may rise: In3gredients (Chicago, IL), PB Leiner (Davenport, IA), and Rousselot (Mukwonago, WI) all import gelatin under GSP, a major ingredient used by American candy manufacturers. Had GSP been in place for the entire year, it would have waived the 4.2 percent tax and saved another $3.2 million on this key raw material.
Flowers are also impacted by GSP expiration. More than $25 million worth of flowers claimed GSP in 2013. Supporter list companies like Costa Tropicals and Flowers (Miami, FL), Esprit Miami (Miami, FL), Flower Explosion (Wilmington, DE), and Kennicott Brothers Company (Chicago, IL) would have saved $1.6 million in reduced import taxes last year had GSP not expired. The import tax currently being charged on flowers is typically 6.4 percent.
For those looking for something more durable than candies and flower, jewelry is a popular option – and another product made more expensive by GSP expiration. More than $660 million in jewelry claimed GSP benefits last year. The tariffs without GSP would have exceeded $41 million. There are too many GSP supporter list companies – at least 36 by our count – importing jewelry to even list! The taxes on things like silver jewelry imported under GSP can be as high as 13.5 percent!
So if you’ve bought candies, flowers, or jewelry this Valentine’s Day (or will scramble to pick some up before this evening), ask yourself a question: how much extra did you pay because Congress allowed GSP to expire?