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Updated October 10, 2018
Miscellaneous Tariff Bills (MTBs)
Background
Expanded ITC Role. In the previous MTB process, the
U.S. International Trade Commission (ITC), an
On September 13, 2018, the President signed the
independent agency with a statutory responsibility to assist
Miscellaneous Tariff Bill Act of 2018 (P.L. 115-239), an
Congress (19 U.S.C. 1332(g)), reviewed bills proposed for
Act that provided temporary tariff suspensions and
MTBs, made recommendations regarding proper tariff
reductions on more than 1500 products. This legislation
classification, calculated tariff amounts, and surveyed
followed the American Manufacturing Competitiveness Act
industries to determine if proposed duty suspensions were
of 2016 (P.L. 114-159) that established a process for
controversial. In the new procedure, the ITC’s role
considering these bills.
expanded to include receiving the petitions for duty
What Are MTBs? Miscellaneous Tariff Bills (MTBs) aim
suspensions or reductions (MTB petitions), collecting
to temporarily suspend or reduce tariffs on certain imported
public feedback, gathering input from other related
products (called duty suspensions). In order to be
agencies, and reporting findings directly to the appropriate
considered for inclusion in an MTB, proposed individual
congressional committees (House Ways and Means and
duty suspensions must be noncontroversial (e.g., no
Senate Finance).
domestic producer or Member objects); revenue-neutral
(forgone tariff revenues of no more than $500,000 per
The new 2016 MTB process began on October 14, 2016,
product); and administrable by U.S. Customs and Border
with an ITC notice published in the Federal Register asking
Protection (CBP).
members of the public who can demonstrate that they are
potential MTB beneficiaries to submit petitions within 60
Debate. Many in Congress support MTBs as a relatively
days (closed on December 12, 2016). Late petitions were
low-cost method of providing a competitive edge to U.S.
not accepted. The ITC received petitions directly and
businesses by reducing tariffs on chemicals and other inputs
published them on a publicly available website no later than
used to manufacture downstream products, thus making
30 days after the end of the 60-day period. Over 3,000
end-use products more affordable to consumers. However,
petitions were submitted. After all petitions and relevant
the former process by which MTBs were originally
documentation were posted, the ITC issued a notice
assembled was controversial because it involved
requesting public comments within 45 days (by mid-
constituents asking individual Members to introduce duty
January 2017). All comments were available to the public
suspension bills to benefit a constituent’s company. These
(see Table 1, MTB Process Timeline in P.L. 114-159,
individual bills were then vetted by the relevant
below).
congressional committees (House Ways and Means and
Senate Finance) for inclusion in a larger package. Some
Commerce Report. In previous MTBs, the Department of
Members criticized the transparency of this process, while
Commerce (Commerce) coordinated the Administration’s
others defended it because Members were required to file
comments on duty suspensions. Commerce analysts, along
disclosure forms listing the beneficiaries of duty
with ITC, also researched proposed duty suspensions to
suspensions and affirm that neither they nor their spouses
determine the existence of any objecting domestic
had any financial interest.
producers. In the new process, Commerce’s role remains
In addition, there were concerns under the former process
essentially the same, with the addition of a deadline.
that duty suspensions violated the House and Senate ban on
On April 10, 2017, within 90 days after the ITC’s
congressionally-directed spending (earmark ban) because
publication of the MTB petitions, Commerce, in
they were “limited tariff benefits,” defined in House and
conjunction with CBP and other relevant federal agencies,
Senate rules as tariff reductions benefiting 10 or fewer
submitted a report on each petition to the ITC and the
entities. Supporters countered that because all enacted duty
congressional committees. The report included, for each
suspensions appear in the Harmonized Tariff Schedule
proposed duty suspension: (1) a determination of whether
(HTS), any importer of the subject products could
domestic production exists, or if domestic production does
automatically take advantage of the cost savings.
exist, whether the producer objects to the MTB petition;
New MTB Process
and (2) identification of technical changes to the
description, if any, necessary for purposes of CBP
To address prior concerns with the process, Congress
administration.
enacted legislation reforming the process for vetting MTBs.
The American Manufacturing Competitiveness Act of
ITC Preliminary Report. The ITC was required to submit
2016, P.L. 114-159, established a process for initiating two
a preliminary report to the House Ways and Means and
MTBs, one in 2016 and one in 2019. In order to be included
Senate Finance committees 120 to 150 days following the
in an MTB, the same conditions for duty suspensions
publication date of the MTB petitions (submitted June 9,
applied (noncontroversial, revenue-neutral, and
2017). For each petition, the report was required to contain:
administrable).
(1) the product’s HTS heading or subheading; (2) a
determination of whether or not domestic production or an
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Miscellaneous Tariff Bills (MTBs)
objection to the duty suspension existed; (3) any technical
Ways and Means Committee and/or the Senate Finance
changes necessary to the product description; (4) an
Committee must publish a list of all “limited tariff benefits”
estimate of the amount of loss in U.S. revenue; (5) a
(i.e., provisions modifying the HTS in a way that benefits
determination of whether the duty suspension or reduction
10 or fewer entities) under a process specified in the
would be available to any importer of the targeted product;
legislation.
and (6) the likely beneficiaries of the duty suspension or
reduction.
Current MTB Legislation
On November 9, 2017, companion MTBs based on the new
Table 1. MTB Process Timeline in P.L. 114-159
process, were introduced in the House (H.R. 4318) and
Date
Action
Senate (S. 2108). The House unanimously passed H.R.
4318 under suspension of the rules on January 16, 2018.
No Later than October 15,
ITC publishes notice requesting
2016 and October 15, 2019
duty suspension petitions
On July 26, 2018, the Senate passed H.R. 4318 by
unanimous consent, with an amendment that removed
60-day period beginning on
Public sends duty suspension
several products from the MTB measure and added several
ITC notice publication date
petitions to ITC
types of lower-priced shoe products. All of these products
No later than 30 days after
ITC publishes duty suspension
(those removed from the bill as well as those that were
60-day period expires
petitions on Internet
inserted) had been previously vetted through the ITC
process, open for public comment, and included in the
45-day period beginning on
Public comment period (also
MTB report submitted by the ITC to Congress. The Senate
the publication date of
viewable by the public)
amendment also extended customs user fees through
petitions
October 13, 2027, instead of April 22, 2026, as in the
No later than 90 days
Commerce, in consultation with
House version. The House agreed to the Senate amendment
following the publication date
CBP and other relevant federal
to H.R. 4318 on September 4, 2018. President Trump
of petitions
agencies, submits report to ITC
signed the measure on September 13.
and appropriate congressional
Issues for Congress
committees
What are the costs and benefits of MTBs? According to
120 to 150 days following
ITC Preliminary Report to
P.L. 114-159, the ITC must submit a report to Congress on
the publication date of
committees
the economic effects of duty suspensions and reductions on
petitions
the U.S. economy within 12 months of the enactment of an
60 days after submission of
ITC Final Report to committees
MTB. In the report, the ITC must also include
preliminary report
recommendations regarding which domestic industries
might benefit from permanent duty suspensions or
No later than 12 months
ITC reports on the effects of MTB
reductions, either through U.S. unilateral action or through
after enactment of MTB
legislation on the U.S. economy
negotiating reciprocal tariff agreements.
Source: Sections 3 and 4 of P.L. 114-159.
Is the new process working as intended, ensuring more
transparency and timely consideration of these
The preliminary report also contained: (1) a list of MTB
measures? Each MTB must be submitted through a process
petitions that the ITC determined met the requirements of
that allows for public comment, and likely beneficiaries are
the Act without modification, as well as lists of petitions for
also disclosed. In the 2016-2017 MTB process, the ITC and
which the ITC recommended; (2) technical corrections; (3)
other agencies were able to meet the time lines prescribed
changes to the amount of duty suspension; or (4) changes to
in the legislation.
the scope of the targeted products. The report also included
a list of all MTB petitions that did not include all the
Is Congress’s constitutional power abrogated through
required information, as well as those for whom the
the MTB process? Some in Congress expressed
petitioner was not a likely beneficiary. Finally, the report
reservations that transferring authority over the MTB
included a list of MTB petitions that the ITC did not
process to the ITC would interfere with Congress’s power
recommend for inclusion.
to regulate foreign commerce, as well as its power to
appropriate. The new process permits the ITC to receive,
Final ITC Report. After taking into account congressional
analyze (with other agencies), and make recommendations
committee feedback and other information, the ITC
on individual MTB petitions. However, no agency may
submitted its final report within 60 days determining, in
exclude a duty suspension from potential consideration by
part, whether each petition (1) is able to be administered by
Congress, or add a duty suspension not submitted through
CBP; (2) does not exceed $500,000 in revenue loss per
the MTB petition process. Any drafting of MTB legislation
year; and (3) is available to any person importing the
remains the prerogative of the House Ways and Means and
product. The final report was submitted on August 8, 2017.
Senate Finance committees.
Congressional Consideration. Congress must act on MTB
Vivian C. Jones, Specialist in International Trade and
legislation in order for it to be enacted. Although P.L. 114-
159 contains a sense of Congress that an MTB should be
Finance
considered no later than 90 days after the final ITC report,
IF10478
there is no requirement in the law for an MTB to receive
floor action. If an MTB is to be considered, the House
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Miscellaneous Tariff Bills (MTBs)
Disclaimer
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