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US Dials Back Trade War Tariffs on Textiles as Coronavirus Stifles Fashion

As the COVID-19 pandemic sends fashion into peak crisis, the U.S. has announced exclusions for some products previously caught in the trade war battle between the U.S. and China.

In a memo Friday, the U.S. Trade Representative said certain China-made products hit in the List 3 and List 4A tariffs won’t face duties for the next few months. For products approved in the exclusion, duty breaks will be retroactive to Sept. 24, 2018, when the $200 billion in List 3 tariffs first took effect, through Aug. 7 this year.

For apparel, women’s, girls’ and infants’ pants, skirts, and dresses made of polyurethane-coated leather are excluded from the trade-war prompted punitive tariffs. On the accessories side, now exempted products include backpacks as well as duffel bags and tote bags of man-made fibers.

For textiles, cashmere or camel hair yarn, polyester filament tow, woven polyester or cotton/poly blends coated with polyurethane, and circular single knitted fabric will see the duty break.

In a show of concern for the sector, USTR also said it would hear additional comments on whether more products could be excluded.

“Today, in an effort to keep current on developments in our national fight against the coronavirus pandemic, USTR has opened a docket for members of the public, businesses, and government agencies to submit comments if they believe further modifications to the 301 tariffs may be necessary,” the trade department said. “

This comment process does not replace the current exclusion process and supplements that process,” it added. “Submissions are limited to comments on products subject to the tariff actions and relevant to the medical response to the coronavirus.”

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With COVID-19 forcing the closure of stores and borders, and a slowdown with factories and flights, fashion brands and retailers are under pressure—and so is the global economy.

On Friday, U.S. Customs and Border Patrol said it’s accepting requests for duty-payment extensions, though it was unclear as to how, and to whom, those would be doled out.

While both the tariff and duty-break news will come as welcome, it may still be a small concession for fashion companies in light of all of the other uncertainties surrounding the sector.

“We hope there will be many more products that receive exclusions,” Julia K. Hughes, president of the U.S. Fashion Industry Association (USFIA), said. “In these very difficult days, we really want to call on the Administration and the Congress to move as expeditiously as possible to also take direct action to support the jobs and companies—both large and small—in the fashion industry. Proposals to delay the payment of duties and financial support for the industry, including suppliers, is urgent.”