The Trump Administration has extended duty-free treatment to imports of all statutorily-eligible travel goods—including luggage, handbags, backpacks, tote bags, etc.—from all eligible countries under the Generalized System of Preferences (GSP) program. The change went into effect on July 1.
The GSP program allows duty-free access to the U.S. market by products from developing and least-developed countries in order to facilitate global competition and to improve consumer choice in the U.S.
In January, the Obama Administration deferred the final decision to expand duty-free treatment beyond ‘least-developed beneficiary countries’ and African Growth and Opportunity Act (AGOA) countries to the then incoming Trump Administration. It had originally approved duty-free treatment for all travel goods from ‘least-developed beneficiary countries’ and AGOA countries on June 30, 2016.
“Today’s announcement is a welcome move that will provide major benefits to U.S. companies, U.S. workers and U.S. consumers,” says Rick Helfenbein, president and CEO of the American Apparel and Footwear Association. “AAFA has long supported efforts to include travel goods under the GSP program, and while last year’s decision by the Obama Administration was an important adjustment, it did not go far enough, and did not meet the original intent that Congress had targeted for this important GSP initiative.
“Today, the industry pays in excess of $90 million a year on duties, which can now be repurposed toward well-paying jobs for U.S. workers, lower costs for U.S. consumers, and/or increased investments in product innovation. Additionally, this move will encourage diversification of the supply chain into developing economies, including the Philippines, Thailand, Pakistan, Indonesia, and Sri Lanka.”
Helfenbein adds, “Now we encourage Congress to move forward with the renewal of GSP before its expiration at the end of the year, and to approve legislation that would make select footwear eligible for GSP benefits going forward.”