From January-July 2021, American companies paid at least $565 million in extra taxes as a result of GSP expiration. Imports into 36 states (plus Puerto Rico) paid at least $1 million in tariffs from January-July 2021 due to GSP expiration. The map below shows estimated tariffs paid for products claiming GSP by state.

July was the most expensive month of GSP expiration yet for 12 states: Georgia, Hawaii, Iowa, Kansas, New Hampshire, Rhode Island, South Carolina, Utah, Vermont, Virginia, Washington, and Wisconsin. In Rhode Island, tariffs costs in July were more than the previously three months combined. Tantalum metals used primarily to manufacture electronic components from Kazakhstan and Christmas lights from Cambodia – the two products driving the Rhode Island increase – show the diverse impacts of GSP expiration.

GSP expiration costs have a direct, negative impact on American workers:

• “GSP can be the difference between making a profit or a loss and without profits we obviously can’t increase wages and benefits” says Charlie Smith of BROSCO, a 4th generation, family-owned millwork distributor in Massachusetts and Maine. “Continued losses put all of our 360 workers’ jobs and livelihoods at risk.”
  
• “We are having challenges staying competitive“ says Ajay Kochhar of A&S Distributors in Salida, California. The 7-worker company has paid over $60,000 in extra taxes on food products from Fiji because of GSP expiration. “We can’t hire and give employees full benefits as this is a major increase.”
  
• “The tariffs when added to the rapidly escalating costs of containers have been devastating” says Sandra Colyer of Lily Koo LLC in Jamestown, North Carolina. “Employees laid off due to Covid are slowly being brought back, but return to work would occur more quickly if money was not being spent on tariffs.”

It is critical that Congress renew GSP – with refunds for tariffs paid – as soon as possible. We strongly encourage GSP importers hurt by expiration to answer our new survey here. As always, no company-specific details will be published without permission.

Even before upward revisions, U.S. companies’ tax benefits from GSP showed massive increases from past years: American companies saved nearly $20 million per month more in 2017 because of GSP compared to just two years earlier.

Through the first half of 2018, GSP savings are up an additional 18 percent and on track to crack $1 billion for the year. While Congress renewed GSP through 2020 to give companies the certainty necessary to encourage such growth, the Trump administration has launched a number of country “eligibility reviews” that could raise taxes for American companies that depend on GSP – by a lot.

There are GSP reviews underway for India, Indonesia, Kazakhstan, Thailand, and Turkey. American companies saved $544 million last year due to GSP for those countries. Collectively, they accounted for 61 percent of GSP savings on imports from all countries.

Given the risk of lost GSP, we strongly encourage companies importing from those countries to sign up for our GSP supporter list and take our review impacts survey, which are both free.

In terms of specific revisions based on the new data, New Jersey saw the biggest jump in savings by value, followed by Florida, California, Georgia, and New York.

Montana saw the biggest jump in GSP savings by percent, followed by Utah, Maine, Florida, and Nevada.

For supplier countries, the largest revision in US savings came on imports from the Philippines, followed by Indonesia, India, Thailand, and Brazil.

Overall, GSP tariff savings increased increased by 8 percent compared to March 2015. The value of imports under GSP increased 6 percent. Some states, such as Iowa and Missouri, saw ever bigger increases in GSP imports and savings compared to March 2015, as shown in the graphic below.

In Iowa, GSP imports increased by 152 percent and savings from GSP by 304 percent compared to one year earlier. Chemicals from India and gelatin from Brazil contributed most to Iowa’s GSP increases. In Missouri, GSP imports increased by 48 percent and savings from GSP by 17 percent compared to one year earlier. Engines from South Africa, auto parts from Turkey, and chemicals from India contributed most to Missouri’s GSP increases.

Imports from Kazakhstan jumped by 238 percent, led by increased imports of ferrochromium by companies in Ohio. GSP eliminated about $108,000 in import taxes on olive oil and nearly half of those imports went to New Jersey.