Trade Cases

Coalition Backs Congress on Clarification of Tariff Exclusion Process

May 8, 2018

Members of Congress have asked the Commerce Department to clarify and improve the process by which manufacturers apply for exclusions from Section 232 tariffs for raw materials required to produce their products. The following is a statement from the Coalition of American Metal Manufacturers and Users commending the action and expressing concern over the use of tariffs.

The Coalition of American Metal Manufacturers and Users today applauded Rep. Jackie Walorski (R-IN), Rep. Ron Kind (D-WI), and 37 other Members of Congress who sent a letter to the Commerce Department yesterday seeking “significant improvement” to the process by which U.S. manufacturers seek exclusions from the Section 232 tariffs on imports of steel and aluminum for products that are not available in the U.S.

The exclusion process, overseen by the Department of Commerce, is creating tremendous confusion in the manufacturing sector, with smaller companies in particular struggling to navigate its vague terms and uncertain deadlines. For its part, the Commerce Department is reportedly buried beneath a backlog of thousands of exclusion applications already submitted, with little indication that it has the means to carry out the review process more efficiently.

The Congressional letter calls on the Commerce Department to make 10 changes to the exclusion process, ranging from extending relief to companies experiencing delays in the Department’s application review process to taking measures to “[review] the impact of the tariffs on the economy and downstream users and implement a plan to sunset them if they prove to have a significant negative impact.”

“We commend Representatives Walorski and Kind as well as their colleagues for standing up for U.S. manufacturing,” said Coalition Spokesperson Paul Nathanson. “Improvements to the product exclusion process would provide at least a bare minimum of relief amidst the chaos that these tariffs have already created to downstream companies who use steel and aluminum.”

U.S. steel and aluminum-using manufacturers are already reporting shortages of both commodities, causing price spikes of 30-40 percent and doubling or even tripling delivery times since the tariffs were put in place in late March.

“Manufacturers who were optimistic because of tax and regulatory reform are now facing an uncertain future because of these tariffs,” said Nathanson. “Without reliable access to certain products, U.S. manufacturing companies will quickly lose out to foreign competitors who can make the same finished products at lower prices—and then ship those products into the U.S. tariff-free.

“Tariffs are taxes. We call on President Trump to put an end to these tariffs now,” concluded Nathanson. “There are ways to deal with global steel and aluminum overcapacity issues without punishing our own companies and communities.”

A copy of the Congressional letter to Secretary Ross can be found here.