Miscellaneous Tariff Bills (MTBs)

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Updated August 13, 2020
Miscellaneous Tariff Bills (MTBs)
Background
suspension bills submitted by Members, made
On August 10, 2020, after receiving input from Congress
recommendations regarding proper tariff classification,
and the public, the U.S. International Trade Commission
calculated tariff amounts, and surveyed industries to
(ITC) submitted its final Miscellaneous Tariff Bill (MTB)
determine if proposed duty suspensions were controversial.
report to the House Ways and Means and Senate Finance
The AMCA expanded the ITC’s role to include directly
Committees. The ITC action follows a specific procedure
receiving MTB petitions from industry representatives,
and timeline enacted in the American Manufacturing
collecting public feedback, gathering input from other
Competitiveness Act of 2016 (AMCA, P.L. 114-159),
related agencies, and reporting findings directly to the
which authorized two MTB cycles using the AMCA
House Ways and Means and Senate Finance Committees.
procedure. In October 2019, the ITC announced that it was
The ITC began the MTB process on October 10, 2019, and
accepting petitions from the public for tariff suspension or
followed a timeline specifically established in the AMCA
reduction for possible inclusion in a MTB, then solicited
(see Table 1, MTB Process Timeline in P.L. 114-159,
public comment on these petitions, and submitted a
below).The process began with an ITC Federal Register
preliminary report to Congress in June 2020. The AMCA
notice asking members of the public who can demonstrate
contains no requirement that either committee introduce an
that they are potential MTB beneficiaries to submit
MTB; rather, the law expresses a “sense of Congress” that
Congress “should” consider a bill within 90 days after the
petitions within 60 days (October 11–December 10, 2019).
Petitioners who wished to continue existing duty
ITC submits its final report. Thus, Congress might consider
suspensions were required to reapply. On January 10, 2020,
an MTB before the 116th Congress concludes.
the ITC published all of the duty suspension requests it
This is the second MTB authorized by the AMCA. The
received on a publicly available website. From January 10
first, the Miscellaneous Tariff Bill Act of 2018 (P.L. 115-
to February 24, the ITC requested public comments on the
239), enacted in September 2018, currently provides
proposed duty suspensions. On March 30, 2020, the ITC
temporary tariff relief until December 31, 2020.
announced that all comments on the duty suspensions were
available to the public.
What is the purpose of MTBs? MTBs aim to temporarily
suspend or reduce tariffs on certain imported products
Commerce Report. In the next step in the process, the
(called duty suspensions). In order to be considered for
Department of Commerce, in conjunction with CBP and
inclusion in an MTB, each proposed duty suspension must
other relevant agencies, was required to a report to the ITC
be noncontroversial (e.g., no domestic producer or Member
and Congress on each petition within 90 days of the
objects); revenue-neutral (forgone tariff revenues of no
publication of the MTB petitions. For each proposed duty
more than $500,000 per product); and administrable by
suspension the report was to include (1) a determination of
U.S. Customs and Border Protection (CBP).
whether domestic production exists, or if domestic
production does exist, whether the producer objects to the
Debate. Many in Congress support MTBs as a relatively
MTB petition; and (2) identification of technical changes to
low-cost method of providing a competitive edge to U.S.
the description, if any, necessary for purposes of CBP
businesses by reducing tariffs on chemicals and other inputs
administration.
used to manufacture downstream products, thus making
end-use products more affordable to consumers. However,
ITC Preliminary Report. The ITC’s preliminary report,
the former process by which MTBs were assembled was
due 120 to 150 days after the publication date of the
controversial because it involved constituents asking
petitions, must contain, for each petition, (1) the product’s
individual Members to introduce duty suspension bills to
Harmonized Tariff Schedule (HTS) heading or subheading;
benefit the constituent’s company.
(2) a determination of whether or not domestic production
or an objection to the duty suspension existed; (3) any
MTB Process in AMCA
technical changes necessary to the product description; (4)
To address these prior concerns, Congress enacted AMCA
an estimate of the amount of loss in U.S. revenue; (5) a
to reform the process for vetting MTBs. The law also
determination of whether the duty suspension or reduction
established a process for initiating two MTBs, one in 2016,
would be available to any importer of the targeted product;
and the second in 2019. To be included in an MTB, the
and (6) the likely beneficiaries of the duty suspension or
same conditions for duty suspensions are applied as in the
reduction. The ITC submitted its preliminary report to
previous process (i.e., noncontroversial, revenue-neutral,
Congress on June 9, 2020.
and administrable).
Final ITC Report. After taking into account congressional
Expanded ITC Role. Prior to passage of the AMCA, the
committee feedback, the additional public comments
ITC, an independent agency with statutory responsibility to
received, and other information, the ITC must submit a
assist Congress (19 U.S.C. 1332(g)), reviewed duty
final report within 60 days determining, in part, whether
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Miscellaneous Tariff Bills (MTBs)
each petition (1) is able to be administered by CBP; (2)
measure and added several types of lower-priced shoe
does not exceed $500,000 in revenue loss per year; and (3)
products. All of these products (those removed from the bill
is available to any person importing the product. The ITC
as well as those that were inserted) had been previously
submitted its final report on August 10, 2020, on a total of
vetted through the ITC process, open for public comment,
3,442 MTB petitions.
and included in the MTB report submitted by the ITC to
Congress. The Senate amendment also extended customs
Table 1. MTB Process Timeline in P.L. 114-159
user fees through October 13, 2027, instead of April 22,
Date
Action
2026, as in the House version. The House agreed to the
Senate amendment to H.R. 4318 on September 4, 2018.
No Later than October 15,
ITC publishes notice requesting
President Trump signed the measure on September 13,
2016 and October 15, 2019
duty suspension petitions
2018.
60-day period beginning on
Public sends duty suspension
What are the effects of the tariffs issued by the Trump
ITC notice publication date
petitions to ITC
Administration on the duty reductions in the MTB (P.L.
No later than 30 days after
ITC publishes duty suspension
115-239)? The Miscellaneous Tariff Bill Act of 2018
60-day period expires
petitions on internet
suspended or reduced tariffs on 1,655 products, about 64%
of which were also subject to additional duties under
45-day period beginning on
Public comment period
Section 301 if sourced from China. Thus, even though the
the publication date of
(comments also viewable by the
MTB provided suspensions and reductions of the general
petitions
public)
(or “normal trade relations” U.S. tariff rate), certain
No later than 90 days
Commerce, in consultation with
Chinese imports were subject to additional tariffs of as
following the publication date
CBP and other relevant federal
much as 25%. According to an ITC report on the economic
of petitions
agencies, submits report to ITC
effects of the 2018 MTB, 15% of U.S. imports by value (or
and appropriate congressional
$839 million) that entered under the MTB were subject to
committees
Section 301 tariffs. This lower percentage may indicate that
some importers found sources other than China for MTB-
120 to 150 days following
ITC Preliminary Report to
covered products.
the publication date of
Congress
petitions
Is the new process working as intended, ensuring more
60 days after submission of
ITC Final Report to Congress
transparency and timely consideration of these
preliminary report
measures? Each MTB must be submitted through a petition
process that allows for public comment, and likely
No later than 12 months
ITC reports on the effects of MTB
beneficiaries are also disclosed. In the 2016-2017 MTB
after enactment of MTB
legislation on the U.S. economy
process, the ITC and other agencies were able to meet the
Source: Sections 3 and 4 of P.L. 114-159.
time lines prescribed in the legislation.
Issues for Congress
Were there any complications in the 2016 MTB petition
cycle?
According to the ITC, many MTB petitions
What are the costs and benefits of MTBs? The AMCA
contained errors in accurately classifying the merchandise
required the ITC to submit a report to Congress on the
according to the Harmonized Tariff Schedule of the United
economic effects of duty suspensions and reductions on the
States (HTSUS).Thus, almost 28% of the petitions were not
U.S. economy within 12 months of the enactment of an
recommended for inclusion in an MTB because the duty
MTB. The ITC report, released in October 2019, indicated
suspensions could not be administered by CBP. In the
that the 2018 MTB, which included 1,655 duty suspensions
2019-2020 cycle, the ITC recommended that petitioners
applied for by 335 separate firms, showed a small increase
research the HTSUS product classification using the
in terms of U.S. output, welfare, and GDP.
Customs Ruling Online Search System (CROSS,
Does Congress have to act for an MTB to become law?
https://rulings.cbp.gov), or submit a request to CBP for a
Although the AMCA contains a sense of Congress that an
binding customs classification ruling (https://apps.cbp.gov/
MTB should be considered no later than 90 days after the
erulings/home), prior to filing an MTB petition. The ITC
final ITC report, there is no requirement in the law for an
also announced a series of workshops and webinars, the
MTB to receive floor action. If an MTB is to be considered,
first of which were held in July and August 2019, to (1)
the House Ways and Means Committee and/or Senate
help potential filers understand the MTB petition process,
Finance Committee must draft legislation and publish a list
and (2) write acceptable product descriptions in various
of all “limited tariff benefits” (i.e., provisions modifying the
HTSUS categories.
HTS in a way that benefits 10 or fewer entities) under a
Will MTBs continue under the current process after this
process specified in the AMCA.
MTB cycle? The AMCA provided for two MTBs, one
In the 115th Congress, companion MTBs based on the new
initiated in 2016 and one in 2019. In order for the MTB
process were introduced in the House (H.R. 4318) and
process to be continued beyond the current (2019-2020)
Senate (S. 2108) on November 9, 2017. The House
process, Congress must extend the AMCA, further amend
unanimously passed H.R. 4318 under suspension of the
the MTB process, or decide not to continue MTBs.
rules on January 16, 2018. On July 26, 2018, the Senate
passed H.R. 4318 by unanimous consent, with an
Vivian C. Jones, Specialist in International Trade and
amendment that removed several products from the MTB
Finance
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Miscellaneous Tariff Bills (MTBs)

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