GSP’s current authorization expires on December 31, 2020, and Congress must pass legislation renewing GSP this year for benefits to continue into 2021 and beyond. Companies that want GSP renewed should add their name to the free GSP supporter list.

By GSP savings, California was far and away the largest GSP beneficiary. California’s estimated $270 million in tariffs waved was nearly as much as the next four largest states – Florida, New York, Texas, New Jersey – combined.

While overall savings levels were lower, imports into Montana and Maine would face the highest average tariffs without GSP (10.9% and 10.6%, respectively). The high average tariff waived results from the dominance of travel goods imports, which can face tariffs up to 20.0% without GSP. GSP waives tariffs averaging about 7.0% on imports into Utah, Wisconsin, Arizona, and Colorado, well above the 5.0% national average.

U.S. companies saved about $180 million in tariffs on imports from Thailand – more than any other country – though GSP eligibility for about 1/3 of imports its products were removed in April 2020. Cambodia was the second most important country for U.S. savings at $169 million, following by Indonesia at $150 million. Despite being GSP-eligible for only 5 months, India was the fourth-most important country in terms of savings at $121 million. Like the states, countries such as Burma and Cambodia where travel goods are most important GSP products had the highest average tariffs waived.

Today we heard from Fast-Pak Trading, one of the nearly 400 GSP supporter list organizations advocating for swift, retroactive GSP renewal. (Use these links to see the full list or add your organization.)

Based in Secaucus, New Jersey, Fast-Pak has 11 employees and imports food products from Macedonia under GSP. Its products are sold in over 1,000 US grocery stores, including Whole Foods and Fairway Markets. However, Fast-Pak has paid $50,000 in extra tariffs in the 5 weeks since GSP expired. According to Fast-Pak’s president:

We deal with food products from Macedonia. These items were hit hard with the expiration of GSP. Customers are not accepting price increases, sales are going down and inventory is not what it should be for this this time of year. Plans to expand the company into other US territories are now on hold until this situation is reversed.

Fast-Pak knows all too well the potential damage of GSP expiration to business operations. Before GSP expired in 2013, the company was growing and planned to hire both new sales people and warehouse staff. Instead, Fast-Pak had to lay off 3 workers and cut salaries by 20% across the board.

GSP renewal, even one that refunds tariffs paid, cannot undo all of the damage caused during the expiration. People that skip buying roasted red peppers today because prices went up are unlikely to buy twice as much in the future because prices returned to normal. Those sales – and the jobs they could support – are gone forever.

Is GSP expiration similarly impacting your company? If so, let us know how by completing this form. As always, no company-specific information will be published without explicit permission.