In the first five months of expiration, American companies paid at least $397 million in extra taxes as a result of GSP expiration. Companies in 32 states paid at least $1 million in tariffs from January-May 2021 due to GSP expiration. The map below shows estimated tariffs for products claiming GSP paid by state in that period.

May was the most expensive month of GSP expiration yet both nationally and for 19 states: Alabama, Colorado, Delaware, Georgia, Hawaii, Illinois, Kansas, Massachusetts, Minnesota, Mississippi, Missouri, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Pennsylvania, South Carolina, and Virginia. In three states – Colorado, Kansas, and New Mexico – tariffs paid in May were at least double any of the previous four months.

While many believe the United States has low tariffs, Colorado companies have paid extra tariffs averaging 11.7% due to GSP expiration. Companies in Maine, Montana, New Hampshire, Utah, and Wisconsin have all paid extra tariffs average 7-10%.

The data on tariffs paid is a conservative estimate, and the real figure likely is higher. Why? Estimates only capture products that continued to claim GSP despite expiration. Yet imports of many products that traditionally get GSP have not claimed it in 2021. Tariffs paid on those imports still would be eligible for refunds in the event of a retroactive renewal, but importers would need to file manual requests.

It is critical that Congress renew GSP – with refunds for tariffs paid – as soon as possible. Companies that want to help the Coalition for GSP educate policymakers on who is hurt by expiration (and how) should:

• join the Coalition for GSP
• add their name to the free GSP supporter list
• answer our very short survey on GSP expiration impacts to date

The top states by GSP savings have been fairly consistent over the years. California accounts for more than a quarter of GSP savings – about as much as the next 4 states (Florida, New York, Texas, New Jersey) combined. Washington and Tennessee have moved into the top 10 states in 2020, replacing Pennsylvania and North Carolina.

Savings are down sharply, from $555 million in 2019 to $407 million in 2020. The map below shows the widespread declines, with the Mountain West being a notable exception. Washington, Idaho, Wyoming, Utah, Colorado, and Arizona form a string of growth states from the Canadian to Mexican borders. Colorado’s savings increased over 150% from 2019, largely driven by a jump in backpack imports. Massachusetts is the only other state where GSP savings are up in the first half of 2020.

Savings declined by over 40% in more than 20 states, including a whopping 78% in Vermont. GSP savings also declined by 67% in Montana and Oklahoma, 63% in North Dakota, 61% in Michigan, 60% in Minnesota, and 52% in West Virginia.

Declines are NOT due to Covid-19. American companies have paid up to $183 million in extra tariffs in 2020 due to GSP suspensions for India, Turkey, and Thailand. In the first half of 2019, tariffs paid due to suspensions (India and Turkey only) were about $35 million. Add those potential savings to actual savings in both years, and the first half totals were nearly identical ($590 million) in spite of Covid-19-related declines. Our next post will dig into state-by-state costs in 2020 associated with the suspensions.

The map below shows the overall value of 2018 GSP imports (in blue) and tax savings (in red) by state.

Increased GSP savings were both large and widespread:

• California saw savings increase by over $50 million (+36%), while New Jersey saw GSP savings jump by about $27 million (+42%).
• Maine‘s savings more than tripled – from about $500,000 in 2017 to nearly $1.6 million in 2018. Savings growth also was very high in Missouri (+59%), North Dakota (+54%), Kentucky (+34%), Delaware (+33%), and South Carolina (+30%).

However, recent decisions to terminate GSP eligibility for Turkey and India mean many of the American companies previously saving money due to GSP now face extra import taxes. Several dozen companies impacted by the decisions were profiled in the Coalition for GSP’s April report: How GSP Termination Would Hurt American Businesses & Workers.

Despite overwhelming congressional support for GSP renewal in 2018, the Trump administration has taken actions that will gut GSP benefits for many American companies. Last week, USTR announced its intent to terminate GSP benefits for India and Turkey.

[Given the risks to those countries and others – companies importing under GSP are strongly encouraged to add their name to our free GSP supporter list]

Imports from India and Turkey accounted for over $330 million of those tax savings for American companies in 2018 – and there could be more bad news to come. There are “pending reviews” for other major GSP suppliers such as Indonesia and Thailand that accounted for over $310 million in GSP savings last year. (Decisions could be announced at any time.) As such, less than 40% of GSP benefits came on products where there is no an immediate risk of losing GSP.

For many states, the situation is even more dire: India and Turkey combined to account for more than 60% of GSP savings for companies in Nebraska (77%), New Mexico (70%), North Dakota (64%), Missouri (64%), Iowa (63%), Delaware (63%), and Oklahoma (61%). House Members from those states voted 25-0 in support of the 2018 GSP renewal bill (2 were not present), but their reauthorization support could be undermined by the Admistration’s actions.

When you include countries under review, 43 states (!) had at least half of all GSP savings in 2018 come from countries at risk of losing GSP. In addition to states listed above, over 80% of GSP savings are at risk for companies in Maine (87%), Tennessee (85%), Mississippi (84%), Alaska (83%), and Minnesota (81%). Again, there was unanimous support among voting House Members from those states for the 2018 reauthorization bill.

Some states such as Kentucky and Virginia saw much larger increases in GSP imports and savings compared to the previous year, as shown in the graphic below.

GSP saved Kentucky companies $1.2 million in April, up over $307,000 (35 percent) compared to one year earlier. Yeasts from Brazil, electric motors from the Philippines, and wire harnesses from Indonesia contributed most to Kentucky’s GSP increases.

GSP saved Virginia companies $1.6 million in April, up over $555,000 (52 percent) compared to one year earlier. Plastics and auto parts from Brazil, travel goods from Cambodia, and from strawberries from Egypt contributed most to Virginia’s GSP increases.

In addition to Kentucky and Virginia, companies in 14 other states saw GSP savings increase by at least 20 percent, including: Alabama, Alaska, Arizona, Indiana, Louisiana, Maine, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Dakota, and Wisconsin.

Savings on GSP imports from Serbia increased by 25 percent compared to April of last year. Oklahoma companies’ purchases of auto parts accounted for nearly 20 percent of GSP imports from Serbia. GSP eliminated about $100,000 in import taxes on crab meat in April, with about a quarter of those savings on imports into Maryland.

More monthly GSP import and savings highlights are on our Graphics page.

REMINDER: GSP expires at the end of 2017. Click here to learn about ways to take action and support GSP renewal this year.

In the first quarter of 2017, GSP imports were basically flat by value and up about 2 percent in terms of tariff savings compared to 2016. The graduation of Uruguay and Venezuela from GSP effective January 1, 2017 contributes to the slow year-over-year growth.

Despite the mixed growth of GSP import values and savings, some states such as Wisconsin and Michigan saw large increases in GSP imports and savings compared to March 2016, as shown in the graphic below.

GSP saved Wisconsin companies $1.3 million in March, up over $420,000 (49 percent) compared to one year earlier. Optical equipment from the Philippines, metalworking machinery from Brazil, and ceramic plumbing goods from India contributed most to Wisconsin’s GSP increases.

GSP saved Michigan companies $2.8 million in March, up over $620,000 (28 percent) compared to one year earlier. Engines from Thailand, wire harnesses from Indonesia, and machine tools from India contributed most to Michigan’s GSP increases.

In addition to Wisconsin and Michigan, companies in 12 other states saw GSP savings increase by at least 20 percent, including: Alabama, Arkansas, Connecticut, Delaware, Indiana, Louisiana, Nevada, New Hampshire, New Mexico, North Dakota, Utah, and Vermont.

Savings on GSP imports from Jordan increased by 157 percent compared to March last year. Illinois companies’ purchases of chickpeas accounted for more than 10 percent of GSP imports from Jordan. GSP eliminated about $770,000 in import taxes on wire harnesses in March, with about 20 percent of those savings on imports into Tennessee.

More monthly GSP import and savings highlights are on our Graphics page.

REMINDER: GSP expires at the end of 2017. Click here to learn about ways to take action and support GSP renewal this year.

• total GSP imports, tariffs savings, and average tariffs waived on account of GSP in 2016;
• companies importing GSP-eligible products;
• top GSP imports by product type;
• top GSP source countries by tariff savings, and
• the extent to which recent GSP expiration periods prevented “real-time” user benefits.

GSP usage differs greatly between states, from the types of products they import to the dependence on suppliers in specific countries. For example:

• Colorado companies saved $4.5 million on imports of about $60 million, meaning average tariffs waived of about 7.5 percent. That was about twice the U.S. average and nearly triple the 2.6 percent average tariff waived in Louisiana.
• North Dakota‘s imports under GSP in 2016 were primarily food products (56 percent), whereas West Virginia‘s imports were auto parts (44 percent). In most states, a single product grouping accounted for at least a quarter of GSP imports.
• Iowa is among the most concentrated states in terms of source countries, with 94 percent of GSP savings on imports from just three countries (India, Brazil, and Thailand) in 2016. Florida is the least concentrated state, with less than half of GSP savings on imports from its top three source countries.
• Idaho importers have paid tariffs on GSP imports more often than not: nearly 60 percent of tariffs waived on imports into the state since 2011 came when GSP was expired, meaning companies paid up front and “hoped for the best” regarding refunds. Conversely, just 33 percent of New Hampshire‘s tariff savings came during expiration periods since 2011.

All reports are available for download, along with other state-specific info, on the state reports page. A sample of the Kentucky report is below.

Some states, such as Arizona and Minnesota, saw particularly large increases in GSP imports and savings compared to January 2016, as shown in the graphic below.

GSP saved Arizona companies $706,000 in January, up $215,000 (44 percent) compared to one year earlier. Semiprecious stones from Brazil and Madagascar, chemicals from India, and plastic statues and decorative items from the Philippines contributed most to Arizona’s GSP increases.

GSP saved Minnesota companies $413,000 in January, up $95,000 (30 percent) compared to one year earlier. Aluminum structures from Thailand, optical lenses from Indonesia and Thailand, and measuring instruments from the Philippines contributed most to Minnesota’s GSP increases.

The increase in GSP savings for American companies has been shared broadly. In addition to Arizona and Minnesota, companies in 16 other states saw GSP savings increase by at least 20 percent, including: Alabama, Alaska, Arkansas, Colorado, Connecticut, Idaho, Louisiana, Maine, New Hampshire, New York, North Dakota, Oregon, Pennsylvania, Rhode Island, South Dakota, Utah, Vermont, and Wisconsin.

Savings on GSP imports from Turkey increased by 23 percent compared to January last year. Georgia companies’ purchases of tires were among the top GSP imports from Turkey. GSP eliminated about $100,000 in import taxes on air bags and parts in January, with nearly all of those savings on imports from Thailand into Utah.

REMINDER: GSP EXPIRES AT THE END OF 2017. Click here to learn about ways to take action and support GSP renewal this year.

Some states, such as Alabama and Ohio, saw particularly large increases in GSP imports and savings compared to December 2015, as shown in the graphic below.

GSP saved Alabama companies $451,000 in December, up $147,000 (48 percent) compared to one year earlier. Silicone from South Africa, PET resin from Brazil, and tungsten ores from Bolivia were among the products contributing most to Alabama’s GSP increases.

GSP saved Ohio companies $2.7 million in December, up $459,000 (21 percent) compared to one year earlier. Ferrochromium from Turkey, machining centers from Brazil, and pesticides from India contributed most to Ohio’s GSP increases.

In addition to Alabama and Ohio, companies in 18 other states saw GSP savings increase by at least 20 percent, including: Alaska, Arkansas, Connecticut, Delaware, Indiana, Iowa, Kansas, Louisiana, Maine, Mississippi, New Hampshire, New Mexico, New York, North Dakota, Oregon, Pennsylvania, Rhode Island, and Texas.

Savings on GSP imports from Egypt increased by 11 percent compared to one year earlier. New York’s purchases of olive oil were among the top GSP imports from Egypt. GSP eliminated nearly $900,000 in import taxes on mangoes and guavas in December, with California accounting for more than a quarter of those savings.

REMINDER: GSP EXPIRES AT THE END OF 2017. Click here to learn about ways to take action and support GSP renewal this year.

Since the Senate approved GSP legislation by a vote of 97-1, American importers have paid about $40 million more in taxes while waiting for the House to act. After nearly 700 days of expiration, exasperated employers around the country find themselves asking: when will the madness end???

It’s not as if the costs of expiration have been declining. In fact, April 2015 was the most costly month in terms of taxes paid for 9 different states: California, Florida, Kansas, Michigan, Nebraska, New Mexico, Tennessee, Utah, and Washington. Imports into Kansas faced more than $300,000 in extra taxes – about 20 percent increase over the previous monthly high (or low, depending on how you look at it). Imports into Washington faced more than $1 million in extra taxes, about 18 percent higher than any previous month.

April 2015 was the second-most costly month for 6 others: Alabama, Colorado, Georgia, Illinois, North Dakota, and Wisconsin. Imports into Wisconsin, the home state of Ways and Means Committee Chairman Paul Ryan, faced nearly $800,000 in extra taxes in April because GSP remains expired.

The map below shows the breakdown of imports and tariffs paid by state from August 2013 to April 2015 because of GSP expiration.

A retroactive GSP renewal would refund taxes paid to companies in every state. Many of the companies that would benefit are among the 700+ companies and associations urging Congress to renew GSP. If you’re not already on the list, please take a moment to add your name here.