Instead of having that money on hand to pay employees, purchase new materials, and otherwise invest in their business, American companies are forced to pay this money to Customs at the border. Companies like Vortex Optics in Wisconsin, Touchstone Crystal in Rhode Island, and many, many others.

For those who value precision, the estimated taxes on (previously) GSP-eligible imports in August was:
Importers of select products were particularly hard hit. Telescopic sights from the Philippines, building stone from Brazil, pesticides and PET resins from India, prepared foods from Thailand, and plywood from Indonesia each faced between $500,000 and $1.2 million in new taxes in August because of GSP expiration. Many other products faced more than $100,000 in new taxes in the first month without GSP.

If your company is one of those being harmed by expiration, be sure to join the 360+ companies and associations on the GSP Supporter List by adding your name here. You can also contact us directly by emailing Dan Anthony.

Just as the arrival of September means something different for each person, the way GSP expiration impacts specific companies can also vary greatly. Past research has shown that the overall cost to American companies is about $2 million per day. We won’t know the actual value for the first month of expiration until the August trade data are released in a month or so, but we can look at responses from our August recess survey to some of the company-specific impacts.

For some, expiration was felt immediately. Vortex Optics in Middleton, Wisconsin paid $150,000 in new taxes while Congress was out of DC in August, and expects to pay another $100,000 this month if GSP remains expired. Those taxes are “putting a severe financial strain” on the 100+ employee business according to Vortex Optics President Daniel Hamilton.

For others like Far East American, a Los Angeles-based importer of tropical plywood, GSP expiration hasn’t hurt…yet. Far East American didn’t import any (previously) GSP-eligible shipments in August, but the company expects to pay more than $250,000 in tariffs in September because of GSP expiration.

Finally, there are others for which GSP expiration means no imports at all. One company in Florida (that wishes to remain anonymous) must bid in the next two weeks on business for 2014. Without GSP in place for imports from Indonesia, it cannot match prices of similar goods from China and Vietnam. As a result, GSP expiration likely will cause the two-person company to lose out on a $2 million contract – a huge deal for a very small company!

These are just a handful of the survey responses, and we’ll post more in the coming days and weeks. If you’re a GSP importer, please fill out this survey so we know how expiration is impacting your company (as you can see above, there’s an option to remain anonymous).

Wisconsin companies imported an estimated $146 million under GSP in 2011, saving them on average 3.3%. India was the most important source of GSP imports, accounting for about 31 percent of the tariff savings. Cocoa paste was Wisconsin’s top import under GSP in 2011.

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 8 in Wisconsin – joined the 2011 GSP Supporter List urging renewal of the program when it last expired.

Are you a Wisconsin 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.