For more than a year, President Donald Trump has suggested that China was footing the bill for the tariffs slapped on United States imports.
But following the White House’s delay of upcoming levies on some Chinese goods, footwear and apparel industry leaders are calling out the president, whose decision, they said, served as muted acknowledgement that trade war costs are ultimately paid by American businesses and consumers.
On Tuesday, the U.S. Trade Representative announced that it would postpone the 10% duty on some of the $300 billion worth of Chinese products, such as mobile phones, laptops and toys as well as unspecified items of footwear and apparel, based on “health, safety, national security and other factors.” The fourth tranche of tariffs has thus been split, with one set impacted with the additional duty on Sept. 1 and another on Dec. 15.
“We’re doing this for the Christmas season,” Trump told reporters. “Just in case some of the tariffs would have an impact on U.S. customers.”
According to the American Apparel and Footwear Association, more than three quarters (or 77%) of all shoes, clothes and home textile imports to the U.S. from China — amounting to about $39 billion worth of goods — will be taxed when the first wave of tariffs hits in less than three weeks.
The other portion, which represents 23% of footwear, apparel and more at a value of roughly $12 billion, will be affected in December during the peak holiday shopping period, the organization found.
“By no means is this a win or a de-escalation,” said AAFA president and CEO Rick Helfenbein. “This is a tax that will hurt every American. Contrary to the headlines, the Grinch has stolen the Christmas selling season for our industry.”
Shoe imports are already heavily taxed, with existing duties averaging 11% and going up to 67.5%, the Footwear Distributors and Retailers of America noted. According to the FDRA, there are 147 classifications of footwear imports in the fourth tranche of tariffs, with 91 of them — including some waterproof shoes, ski boots, sports sneakers and sandals — being hit on Sept. 1. The other 56 classifications will see the new duties on Dec. 15.
For context, the 147 classifications of footwear impacted in the fourth tranche, were valued at $14.1 billion in 2018, or about 53% of the dollar value of total footwear imports.
“It is no coincidence that the administration is allowing certain shoes to come in without raising taxes in hopes that prices do not rise at retail during the holidays,” said FDRA president and CEO Matt Priest. “While we are pleased with the decision to delay new tariffs on certain shoes, we are not satisfied. We will continue to fight for any exclusions on new tariffs, and we will fight to delay new tariffs on shoes until the entire tariff threat is lifted off the backs of American families.”
As costs grow within the supply chain, many corporations have indicated that they may be left with no choice but to raise prices for consumers. Such tariffs would also affect domestic manufacturers, considering that many materials necessary for production are sourced through China and unavailable in the U.S. Tariffs would affect footwear jobs as well, with several companies already making attempts to relocate their supply chains to neighboring countries like Vietnam, Indonesia and even America’s southern neighbor, Mexico.
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