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.

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.

Burris Company, a manufacturer in Greeley, Colorado, has paid nearly $400,000 in tariffs due to GSP expiration. Vice President of Finance Mike Kinnison reports: “Burris Company manufactures as well as imports. The lower cost of imports helps to sustain our manufacturing and keep overall costs low. Additional tariffs puts US manufacturing at risk. Much more delay will result in canceling any large capital investments and lead to layoffs.”

Franklin Mfg Inc. in Jericho, New York has paid about $25,000 in tariffs due to GSP expiration. It raised prices to reflect tariffs, which led to lost sales and lower planned purchases going forward. As Franklin Mfg President and Owner Jesse Taube reports: “We are in a vulnerable position to lose our current customers due to not being as competitive.”

Fusion Gourmet, a food importer in Rancho Dominguez, California that has paid $25,000 in tariffs, similarly raised prices and lost sales. According to Fusion Gourmet President Steve Liaw, job impacts are felt by workers in both the United States and Indonesia, it’s primary GSP source country.

• In the United States: “Due to increased costs related to GSP, we are not able to increase our hiring for 2021. These additional costs directly impact our budget that we allocate towards seasonal hiring.”
• In Indonesia: “We will also reduce our orders from factories that are in countries impacted by GSP. This lost revenue will negatively impact these factories which are usually 70+% women workers.”

A Simpler Time, which is based in Morrisville, North Carolina and also operates a retail store in New Orleans, Louisiana, reports how GSP expiration directly hurt wages for its American workers. According to A Simpler Time President Jeff King: “Normally [we] pay quarterly bonuses to employees, but have delayed them as we can’t pass all the increased costs on to customers.” It also didn’t replace a worker that left and reduced another’s hours due to a combination of higher import costs, supply chain issues, and retail sales that remain well below pre-Covid levels.

If you’re a company impacted by GSP expiration, please answer our very short survey on GSP expiration impacts to date (the source for all of the above examples). To further help the Coalition for GSP educate policymakers on who is hurt by expiration (and how), companies are strongly encouraged to:

• write their lawmakers about GSP renewal with our Contact Congress tool
• join the Coalition for GSP
• add their name to the free GSP supporter list

Our first video comes from Xpres LLC in Winston-Salem, North Carolina. After tripling employment from 25 to 75 workers since 2015, Xpres has been forced to downsize this year due to Covid-19. Not only did Xpres shut down for 3 weeks, many of its customers around the country did too. In the words of CEO Jan Reid, it’d be “double trouble” if GSP expires and its raw material imports from Thailand face 10% tariffs starting January 1.

Watch the full clip below. If you’re a GSP importer, submit your own video testimonial here.

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.

Those dollars and cents impact peoples lives and livelihoods: Sugarpod laid off a staff member and cut worker benefits due to higher costs. It scaled back other investments as well, including canceling plans to expand its product lines.

In addition to the $30,172.01 that is unavailable to Inplac for investing in operations, the company also lost sales due to GSP expiration. Factoring in 4.2% import taxes make it difficult to compete in the low-margin market for plastic bags.

As noted previously, there are no refunds for sales not made, meaning companies can never truly “recoup” all the losses from GSP expiration. The longer Congress allows GSP to remain expired, the greater the potential damage for companies and workers alike.

Both Sugarpod and Inplac provided this info by answering our GSP expiration survey, which you can complete here. As always, no company-specific information will be published without explicit permission.

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.

• Thompson Traders in Greensboro, North Carolina: GSP expiration cost Thompson Traders $220,000 and forced it to lay off 8 people, dropping employment to 12 workers. With GSP renewed, Thompson Traders initiated a new product line and has doubled to 25 workers.
• Universal Arquati in Santa Clarita, California: After paying over $180,000 in extra import taxes during GSP expiration, renewal allowed Universal Arquati hire 12 new workers and buy equipment that will help increase sales even more.
• Sophia Foods in Brooklyn, New York: GSP expiration cost Sophia Foods $46,000 in extra taxes and forced the small business to lay off 2 workers. With GSP back in place, Sophia Foods hired 2 workers to fill the positions eliminated during expiration – and then added 2 more new positions.

• Xpres LLC in Winston-Salem, North Carolina: After paying $672,000 in extra taxes during expiration, GSP renewal allowed Xpres to invest in new equipment for its North Carolina facility and hire 17 new workers – a 60 percent increase!
• B&C Technologies in Panama Beach City, Florida: GSP expiration cost B&C $175,000 in extra tariffs and the company could not complete necessary upgrades to a new facility. GSP renewal allowed it to start developing a new product line, including hiring new workers.
• M S International (MSI) in Orange, California: GSP expiration cost MSI $8 million in extra taxes. Big refunds and even bigger savings going forward helped MSI hire 280 new workers and double its capital expenditures in the year and a half after GSP renewal.