U.S. Trade Representative Robert Lighthizer released a statement last night that President Trump has ordered him to begin the process of imposing 10% tariffs on a new round of $200 billion of Chinese imports, in addition to the 25% tariffs on $34 billion worth of Chinese imports that started July 6. Under consideration for these new proposed tariffs are solar inverters, AC modules and batteries.
These tariffs come under Section 301 of the Trade Act. A Section 301 investigation allows the president to take all appropriate action to remove policies or practices of a foreign government that violate trade agreements or restrict U.S. commerce. In this instance, the United States found that China’s actions related to “technology, intellectual property and innovation are unreasonable and discriminatory and burden U.S. commerce.” The suggestion is to place duties on more Chinese goods.
The new round of proposed tariffs are in response to China’s retaliation against the July 6 tariffs with its own matching tariffs on $34 billion of U.S. exports.
“For over a year, the Trump Administration has patiently urged China to stop its unfair practices, open its market, and engage in true market competition,” Lighthizer said. “We have been very clear and detailed regarding the specific changes China should undertake. Unfortunately, China has not changed its behavior.”
Chinese solar panels are being considered for additional 25% tariffs (on top of the 30% foreign solar panel import tax already enacted) as announced last month under the category “8541.40.60: Diodes for semiconductor devices, other than light-emitting diodes.” These solar panel tariffs have not yet been decided.
These new proposed 10% tariffs would include inverters (8504.40.95: Static converters), AC modules (8501.61.00: AC generators of an output not exceeding 75 kVA) and non-lithium-ion batteries (those made of manganese dioxide, mercuric oxide, lead acid, nickel cadmium or nickel iron).
Inverter companies under threat of these 10% tariffs include Enphase, Huawei and more.
The Office of the United States Trade Representative will again hold a public notice and comment process, concluding in late August. Then the office will make a final determination and could or could not initiate tariffs on Chinese solar imports.