Treasury Secretary Says Tariff Decision on Remaining Chinese Imports at Least a Month Away
Treasury Secretary Steven Mnuchin, who faced many critical questions from House Democrats on the China trade war, told them that consumer goods were left until last for a reason, and that a decision on levying tariffs on the remaining imports from China -- including toys, apparel, cellphones and computers -- has not yet been made. “There won’t be any decision probably for another 30 to 45 days," Mnuchin testified at the Financial Services Committee May 22. He said that he had recently spoken to the chief financial officer at Walmart about the increase in tariffs on the third tranche of Section 301 tariffs and the possibility of tariffs on nearly all remaining imports.
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"We are monitoring things carefully and there will be some exceptions," he said, referring to an exclusion process. That process, run by about 25 people at the Office of the U.S. Trade Representative, has not yet finished the first $34 billion tranche, and has not even begun the third tranche evaluations.
"My expectation is a lot of business will be moved from China to other places in the region, so that there will not be a cost," Mnuchin told Rep. Cindy Axne, D-Iowa. Axne continued to press Mnuchin on his assertion that most of the tariffs will not be paid by consumers. She responded, "You disagree with all our key retailers in the country, and experts who understand that tariffs are most likely going to be passed on to consumers, because that is historically what happens?"
"Tariffs are a tariff on imports, they are not a tax," he said.
Dean Phillips, D-Minn., told Mnuchin that he's hearing from the CEO of Cargill and Polaris, both in his district. Polaris executives told him that the China tariffs will probably be a $150 million to $200 million hit to the bottom line. "What do I tell companies like Polaris? And what is our end game?"
"Unfortunately China took a big step backwards," Mnuchin said, but expressed hope that all is not lost. "The two presidents will likely see each other at the end of June. The idea is not to have tariffs, the idea is for them to treat our companies fairly."