A bipartisan group of U.S. House lawmakers introduced a bill on April 17 that seeks to prevent U.S. trade policy from favoring certain foreign e-commerce distribution operations.
Current U.S. law allows companies to ship products directly from foreign warehouses to U.S. consumers duty and tax-free if the products are worth $800 or less. Retailers located within U.S.-based foreign trade zones (FTZs) are barred from this same duty-free benefit on otherwise identical shipments and face up to a 60 percent cost disadvantage per shipment.
The U.S. Foreign Trade Zone Parity Act, H.R. 8059, aims to fix this issue by allowing companies operating in the nearly 300 U.S. based FTZs to utilize de minimis entry procedures. This, in turn, will create parity with foreign distributors. The bill complements the House Ways and Means Committee’s action this week to crack down on China’s de minimis abuses by making products subject to the Section 301 tariffs ineligible for de minimis entry.
“E-commerce shipments from outside the United States should not be afforded special treatment compared to shipments from inside the U.S.,” U.S. Rep. Brian Fitzpatrick (R-PA), one of the sponsors of the bill, said. “I’m proud to co-sponsor this bipartisan legislation that would create parity in U.S. trade laws and preserve the jobs of hardworking Americans.”
The legislation was also sponsored by U.S. Reps. Brad Wenstrup (R-OH), Mike Carey (R-OH), Ruben Gallego (D-AZ), Lou Correa (D-CA), and Carol Miller (R-WV).
“Our current trade policy counterintuitively benefits adversaries like China and causes the loss of American jobs and opportunity. I believe it’s important for our trade and foreign policy to align; and I’m pleased that my colleagues, both Democrat and Republican, have joined me on this bill to ensure our trade policy doesn’t punish U.S. businesses operating within the U.S.,” Wenstrup said.