A tariff bill could have wide-ranging impact on U.S manufacturing

| May 11, 2018 | Uncategorized |

Before Donald Trump was president, he garnered headlines by promising to return product manufacturing to the United States. He visited North Carolina and singled out a local company, Leviton Manufacturing. The company, a maker of light switches and electrical outlets, had closed factories in the state and was outsourcing its manufacturing overseas. According to The Atlantic, Trump vowed to raise taxes for companies like Leviton.

Miscellaneous Tariff Bill Act

The Miscellaneous Tariff Bill Act passed the House in January and is waiting on approval from the Senate. The bill would eliminate the taxes a company like Leviton must pay to import certain manufactured goods from China. Essentially, the bill does the opposite of what Trump stated he would do, removing taxes on outsourced goods instead of raising the tax rate.

Members of Congress that support the bill state it will eradicate stiff tariffs on items like raw materials and components that are used in American manufacturing. Like so many bills, that is not all that is included. The bill also includes a tariff waiver that exempts completed goods like electric vans, microwaves and fishing rods from being taxed. Many of these items, like the Leviton outlets, used to be manufactured in the United States.

Support from the National Association of Manufacturers

The bill has powerful support from other parties. According to The Hill, The National Association of Manufacturers sent a letter to Congress in support of the bill. The group estimated the bill would get rid of $1.1 billion in import tariffs in the next three years, as well as increasing U.S. manufacturing productivity by more than $3.1 billion.

When discussing numbers like that, it is easy to see why this bill is controversial. The president wants to strengthen American’s manufacturing industry, so vetoing a bill like this could seem like he is working against the industry. However, with the provisions like the tariff waiver, the bill does work against the inroads President Trump has pledged to make. If it passes, companies like Leviton would likely continue to export the manufacture of its goods out of the U.S.