Bill Would Create 10-Year Tariff Exemption for Bicycle Parts Used in US Assembly Operations
A recently introduced bill would create a 10-year tariff exemption for bicycle parts, with importers required to certify and document to CBP that the parts were used in the assembly of bicycles in the U.S. to qualify for the exemption, according to the text of the bill, released July 24.
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H.R. 8625, introduced in early June by Rep. Earl Blumenauer, D-Ore., would set out a list of subheadings that qualify for the exemption. It would apply to parts used in the U.S. assembly of both traditional bicycles and bicycles with an electric motor. The exemption would apply to both regular duties and Section 301 tariffs, as well as tariffs imposed under “any other provision of law based on the classification of such parts under any of chapters 1 through 97.” The bill would also establish an electric bicycle production tax credit and a loan program to support domestic investment in bicycle manufacturing.
New Chapter 99 subheading 9903.87.11 would be created for the tariff exemption. A new note to Chapter 99 subchapter III would define the assembly of bicycles as “the fitting or joining together of fabricated components in such a way that amounts to the substantial transformation of components classifiable as parts.”
Current bicycle part subheadings that would be eligible for the exemption include 3923.50.00; 3926.90.96; 4011.50.00; 4013.20.00; 4908.10.00; 7315.11.00; 7326.90.25; 8501.31.40; 8501.31.50; 8501.31.60; 8507.20.80; 8507.30.80; 8507.50.00; 8507.60.00; 8512.90.40; 8543.70.45; 8714.91.20; 8714.91.30; 8714.91.50; 8714.91.90; 8714.92.10; 8714.92.50; 8714.93.28; 8714.93.35; 8714.93.70; 8714.94.30; 8714.94.90; 8714.95.00; 8714.96.10; 8714.96.50; 8714.96.90; 8714.99.10; 8714.99.50; 8714.99.60; and 8714.99.80.
The bill would also require a report from the International Trade Commission five years after enactment on the effects of the tariff exemption and its contribution to the goal of assembling 2 million bicycles annually in the U.S. within those five years, as well as the potential to assemble 5 million annually within 10 years.
The tariff exemption would apply to entries on or after the bill’s enactment, and would expire 10 years from the date of enactment.