Major retailers and manufacturers are pushing for tariff exemptions as the Trump administration considers actions following multiple trade investigations spanning 60 trading partners.
This week, the United States Trade Representative held hearings related to proposed tariffs following Section 301 probes launched over the last year. The potential actions include a 25% levy on imports from Brazil and a 10% or 12.5% tariff on goods from 60 trading partners. The latter derives from USTR allegations of failure to effectively curtail products made with forced labor from entering the U.S.
For both proposed tariffs, the USTR outlined a list of exempted goods that would not be covered by the levies if implemented, including entries covered by the United States-Mexico-Canada Agreement. Additionally, the agency solicited comments from interested parties to help further refine the scope of the proposed levies.
Ahead of the hearings, more than 1,500 stakeholders, including trade groups and individual businesses such as BJ's Wholesale Club and Ford Motor Co., submitted written responses seeking additional product exemptions. The requests cover numerous goods, including water filtration systems used for Brita filters, plastic injection molding machinery for uses in appliance manufacturing, and toys and Christmas decorations.
Several companies said a lack of domestic production capacity or availability for certain goods meant exemptions were required. Below is a detailed look at which goods retailers and manufacturers in specific industries would like shielded from potential tariffs resulting from the investigations.
Retailers and manufacturers seek tariff relief
Retail
Several retailers sought broad tariff exemptions across categories, while others requested protections for individual product types, such as salmon and olive oil.
Tractor Supply Company said the proposed forced labor tariffs would impact key sourcing markets for many of its products where domestic production is limited or not available.
“Imposing additional tariffs on essential rural goods for which there is no domestic capacity would not eliminate those foreign practices,” Seth Estep, EVP and chief merchandising officer for Tractor Supply, wrote. “Instead, this would burden a major U.S. retailer and its U.S. customers without changing the underlying sourcing constraints.”
Meanwhile, ecommerce giant eBay called for a blanket exemption for second-hand goods since the Section 301 tariffs are meant to crack down on production with forced labor.
“A tariff imposed at the point of secondary-market resale does not create any economic signal that reaches the original producer, much less any forced labor practice implicated in the good's initial manufacture,” Cathy Foster, VP of global government relations and public policy for eBay, wrote. “The tariff penalizes the resale of a good, not its production.”
Food manufacturing
Food brands such as Mars Inc., McCormick and Co. and Nestlé struck a similar chord in their exemption requests, noting that geography and climate made certain goods impossible to produce in enough quantities domestically to meet U.S. demand, necessitating importation.
For example, Mars said palm oil, largely imported from Thailand and Malaysia, should be covered by any exemptions to the proposed tariffs because domestic alternatives with equivalent quality “do not exist.”
In its appeal seeking exemptions for numerous spices and herbs, McCormick not only argued that such exemptions were necessary due to a lack of domestic availability, but that they would also “promote efficiencies in U.S. food ingredients manufacturing.”
Automotive manufacturing
In its tariff proposals tied to the investigations, the USTR said that exemptions would be made for goods subject to Section 232 tariffs, such as those on cars, trucks, buses and auto parts.
However, automotive manufacturers are pressing for additional protections, primarily to support the continued buildout of U.S. manufacturing capacity for advanced technologies such as electric vehicles and battery energy storage.
Tesla noted that while it is actively investing in domestic production and onshoring, the “transition will take time.”
“Certain critical inputs cannot yet be sourced at the scale and quality necessary to sustain competitive U.S. manufacturing without some continued access to established international supply chains,” the company wrote.
Electronics and appliance manufacturing
There was a gamut of requests from the electronics and appliance manufacturing sector. Some, such as home appliance companies Electrolux Consumer Products and Conair, pushed for exemptions for finished goods such as electric hair dryers and curlers, as well as speciality components needed for production.
“In many instances, highly specialized motors, compressors, electronic controls, semiconductors, wire harnesses, specialty steel products, and other critical inputs must be sourced globally to maintain efficient production and meet consumer demand,” Diane Burke, acting general counsel for Electrolux, wrote.
Similarly, GE Appliances sought a shield for equipment it uses to manufacture its products, such as specialized machinery, automation systems, molds and capital equipment. The company specifically argued that tariffs on such imports would raise production costs and hurt its ability to invest in the U.S.
“Every dollar diverted to unnecessary tariff costs is a dollar that cannot be invested in expanding American manufacturing capacity or creating additional U.S. jobs,” Jim Kiley, director of federal government affairs at GE Appliances, wrote.
Elsewhere, some companies suggested larger adjustments to the proposed actions entirely. Whirlpool Corp. asked for full exemption for businesses in good standing with Custom and Border Protection’s Customs-Trade Partnership Against Terrorism program, while Bissell Homecare, in addition to seeking exclusions for floor care products, requested that Vietnam be given a lower tariff rate.
“Vietnam belongs closer to the 10% category than the 12.5% category given its domestic legal framework, its active participation in bilateral consultations with USTR,” Joel Van Winkle, VP, general counsel and secretary for Bissell, wrote.