DUTY FREE TREATMENT REVOKED FOR INDIA AND TURKEY
On March 4, 2019 the U.S. Trade Representative, at the direction of President Trump, notified Congress that the U.S. will terminate duty free treatment for certain goods from India and Turkey under the Generalized System of Preferences (GSP). The announcement begins a 60 day countdown before a presidential proclamation can be issued ending GSP benefits for the two countries.
India was the largest beneficiary of the program with $5.7 billion in duty free imports in 2017. Turkey was fifth with $1.7 billion. Importers should prepare for the impact of additional duty costs on GSP eligible goods from either country. Your Janel Customer Service Representative can help you determine which of your imports are impacted.
According to the USTR, “India’s termination from GSP follows its failure to provide the United States with assurances that it will provide equitable and reasonable access to its markets in numerous sectors. Turkey’s termination from GSP follows a finding that it is sufficiently economically developed and should no longer benefit from preferential market access to the United States market.”
What is GSP?
Created in 1974, the Generalized System of Preferences is the country’s oldest and largest trade preference program. Its purpose is to promote economic growth in developing countries. GSP provides duty free treatment to thousands of items imported from any of the 120 eligible countries.
As countries’ economies develop, and their market share increases, they can reach a point where this assistance is no longer necessary. At one time, Korea, Taiwan, Hong Kong, and Singapore were all GSP eligible countries