From January-August 2021, American companies paid at least $666 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.

August was the most expensive month of GSP expiration yet both nationally and for 15 states: Alabama, Delaware, Georgia, Hawaii, Idaho, Maryland, Minnesota, Montana, New York, North Carolina, Oklahoma, Pennsylvania, South Carolina, Texas, and Washington. Tariffs paid on imports into Minnesota were 84% higher than any previous month. For Pennsylvania and Georgia, tariffs paid were 53% and 27% higher than any previous month, respectively.

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.

In the first six months of expiration, American companies paid at least $480 million in extra taxes as a result of GSP expiration. Companies in 34 states (plus Puerto Rico) paid at least $1 million in tariffs from January-June 2021 due to GSP expiration. The map below shows estimated tariffs for products claiming GSP paid by state in that period.

June was the most expensive month of GSP expiration yet for 12 states: Alabama, Colorado, Delaware, Iowa, Maine, Maryland, Minnesota, New Hampshire, Ohio, Oklahoma, Rhode Island, and South Carolina. For Alabama, Colorado, and Delaware, each new month has been the most expensive one yet (e.g., June was more than May, which was more than April, which was more than March…).

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. 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. Companies that want to help the Coalition for GSP educate policymakers on the importance of GSP should also join the Coalition for GSP and/or add their name to the free GSP supporter list.

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

GSP saved Georgia companies $3.9 million in December, up $1.3 million (49 percent) compared to one year earlier. Metal products from Brazil, luggage from Thailand,  and chemicals from India contributed the most to Georgia’s GSP savings increases.

GSP saved North Carolina companies $2.0 million in December, up $577,000 (39 percent) compared to one year earlier. Chemicals from the Philippines, furniture fittings from Thailand, and wood products from Indonesia contributed most to North Carolina’s GSP increases.

In addition to Georgia and North Carolina, companies in 26 other states saw GSP savings increase by at least 20 percent, including: California, Connecticut, Florida, Idaho, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Minnesota, Missouri, Montana, Nebraska, Nevada, New Jersey, Ohio, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, and Wyoming.

Savings on GSP imports from Indonesia increased by 31 percent compared to December of last year. California companies’ alone imported $4.6 million in silver jewelry under GSP in December. GSP eliminated about $1.5 million in import taxes on mangoes and guavas in December. About two-thirds of those savings were on imports into New Jersey.

*** REMINDER: GSP EXPIRED EFFECTIVE JANUARY 1.***

The House passed GSP renewal legislation in February, but the Senate must pass legislation for GSP benefits to resume. Please use our Contact Congress tool to write your Senators about GSP renewal; answer our brief survey on how GSP expiration impacts you, and/or sign up for the free GSP supporter list to show the broad support for renewal.

GSP imports were up by 15 percent – and tariffs savings were up by 17 percent – compared to a year earlier. Some states such as Nebraska and Maryland saw much larger increases in GSP imports and savings compared to the previous year, as shown in the graphic below.

GSP saved Nebraska companies $105,000 thousand in June, up $42,000 (68 percent) compared to one year earlier. Activated carbon from the Philippines, copper alloys and rubber stoppers from India, and aluminum frames from Thailand contributed most to Nebraska’s GSP increases.

GSP saved Maryland companies $2.1 million in June, up over $450,000 (28 percent) compared to one year earlier. Silicon from Kazakhstan, carbides from South Africa, and zinc from India contributed most to Maryland’s GSP increases.

In addition to Nebraska and Maryland, companies in 17 other states saw GSP savings increase by at least 20 percent, including: Alabama, Alaska, California, Colorado, Delaware, Indiana, Louisiana, Maine, Montana, Nevada, New Hampshire, North Carolina, Pennsylvania, Texas, Virginia, Washington, and Wisconsin.

Savings on GSP imports from Lebanon increased by 58 percent compared to June of last year. Illinois companies’ purchases of nuts accounted for nearly $250,000 of the GSP imports from Lebanon. GSP eliminated about $471,000 in import taxes on steering wheels in June, with more than a fifth of those savings on imports into Michigan.

Photo by Lehigh Valley, PA [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons

On Monday, President Donald J. Trump declared July 16-22 to be “Made in America” week and held an event at the White House highlighting American-made products. Yet such events often overlook the benefits of imports, including programs such as GSP, in creating those American-made products.

Take BTR International, a small business in New York City that imports engine-ready camshafts from Brazil. GSP eliminates the 2.5 percent tariffs those imports would otherwise face. GSP savings help BTR provide the best-possible prices to customers, including iconic American manufacturers such as Mack Trucks.

Mack is among the world’s largest manufacturers of heavy-duty trucks, engines, and transmissions. Founded in 1900, Mack has an engine plant in Hagerstown, Maryland and assembles all its trucks for the North America market in Macungie, Pennsylvania. Mack exports its trucks throughout North and South America, Australia, and Africa.

The indirect savings from GSP for Mack are emblematic of the broader automotive industry. In 2016, GSP eliminated $78 million in taxes on auto parts ranging from camshafts to wire harnesses to brakes parts and tires. Michigan, California, and Tennessee were the principal beneficiary states.

By eliminating such taxes, GSP provides the U.S. auto industry a competitive edge. (Our GSP Supporter List includes numerous companies importing auto parts.) Without it, the higher costs would trickle through the supply chain, from small importers like BTR to major producers like Mack and eventually to the end customers at home and abroad. Such cost increases could lead to diminished sales and a cutback in U.S. auto manufacturing capacity.

GSP expiration in 2013 had a snowball effect familiar to many small business users of the program: raising prices to cover the new tariffs led to lower sales. Lower sales resulted in less money available to purchase new inventory, which in turn led to even lower sales. Eventually, Aid Through Trade was forced to freeze hiring and delay necessary equipment updates.

All for what many might consider to be modest tariffs of $30,000 extra over two years. Yet seemingly modest amounts can make a huge difference for small businesses like Aid Through Trade.

With GSP back in place, Aid Through Trade was able to hire a new worker in Maryland and give thousands of dollars in bonuses to its staff. It also invested in new technologies as sales have returned to pre-2013 levels.

Like many GSP program users, Aid Through Trade is both importer and exporter. (About 45% of GSP Supporter List companies export.) Aid Through Trade exports products that enter duty-free under GSP to Europe.

Nearly 340 organizations in 41 states (plus DC) have now joined the supporter list. You can see them all here. If you’re not on the list but want Congress to renew GSP, be sure to add your name here so we can keep highlighting the importance of GSP to the different states and congressional districts.

They come from 10 states and 17 congressional districts. Half of them are very small businesses with 10 or fewer employees – the types of companies that can least afford a significant tax hike! In fact, the largest of the companies has 130 workers. (Keep in mind the U.S. government classifies “small or medium-sized companies” as those with less than 500 employees.)

Since they were just hours too late to make it onto the letter, we’ve listed them below to make sure they get their proper due. You can see the entire list here. Remember, we’ll keep updating the list until Congress renews GSP, so make sure to add your name here if you’re not already on it!

So without further ado, here are the new GSP organizations:

• Artistic Tile (Secaucus, NJ)
• Avani Granite & Marble, Inc. (Houston, TX)
• C.A.S. Iberia Inc. (Sale Creek, TN)
• Chemlock Metals Corporation (Cincinatti, OH)
• Dayna Designs (Westminster, MD)
• Eastland Food Corp (Jessup, MD)
• Franklin Mfg. Inc. (Jericho, NY)
• HaloPolymer Trading Inc. (Houston, TX)
• ICC USA (Louisville, KY)
• Jubilant Life Sciences USA Inc. (Bedminster, NJ)
• Kamali Global Inc (Manhasset, NY)
• Kerr-Hays Company (Ligonier, PA)
• Mercer Tool Corp. (Deer Park, NY)
• Mitusha International Corp. (Dover, DE)
• NYAG Inc (New York, NY)
• Oriental Rug Importers Association (Secaucus, NJ)
• Reading Alloys (Robesonia, PA)
• Shipyard Supply, LLC (Metairie, LA)
• Steel and Wire Products (Baltimore, MD)
• TRI-K Industries Inc. (Denville, NJ)

Maryland companies imported an estimated $768 million under GSP in 2011, saving them on average 4.3%. Thailand was the most important source of GSP imports, accounting for about 41 percent of the tariff savings. Silver jewelry was Maryland’s top import under GSP in 2011 and would have faced average tariffs of 5.2% without GSP.

Yet GSP is set to expire on July 31, 2013, and companies could face tariffs higher tariffs starting on August 1 if Congress does not pass legislation renewing GSP. When GSP expired at the end of 2010, American companies paid nearly $2 million per day, every day, until Congress finally acted 11 months later!

This graphic shows just some of the negative impacts from the last GSP expiration. It also helps explain why more than 335 companies and associations – including at least 11 in Maryland – joined the 2011 GSP Supporter List urging renewal of the program when it last expired.

Are you a Maryland company that would be hurt by GSP expiration? If so, please take 30 seconds to let Congress know by adding your name to our free 2013 GSP Supporter List right now.