GSP saved American companies $91 million in October, about $15 million less (-15%) from October 2018. It marked the fifth month in a row that year-over-year savings declined. Before June 2019, year-over-year GSP savings rose in 37 straight months.
Savings declines were due wholly to terminated GSP for India and Turkey. Lost GSP for India and Turkey cost American companies as much as $37 million in extra tariffs in October, including up to $29 million in new taxes on imports from India and $8 million on imports from Turkey.
The financial impact of the decisions are clear, as shown in the graph below. While GSP savings were skyrocketing like never before, they are now falling for the first time in many years. The gap between actual GSP savings and what “could have been” without the terminations – the red bars in the graph – widened to almost $180 million in October.
Despite the India/Turkey decisions, GSP saved American companies $890 million in the first 10 months of 2019 compared to $860 million in the same period in 2018. In October, GSP savings from other countries rose $18 million (25 percent) from $73 million in October 2018.
Savings growth has been particularly strong for products subject to Section 301 “List 3” tariffs if imported from China. GSP savings on products on “List 3” increased over 40% in October, while GSP savings on all other products declined 3%.
