WTO Rules Against US Tariffs (including Aircraft Parts)

The WTO issued a ruling against the United States’ punitive tariffs on Chinese goods, but it might not change the 25% duty rate on aircraft parts imported from China.

The United States imposed punitive tariffs on a variety of goods imported from China, including aircraft parts. The duty on aircraft parts from China was 25% of their value (even though typically aircraft parts are imported duty-free under the harmonized tariff schedules).

The World Trade Organization (WTO) released a ruling today that concluded that the tariffs were inconsistent with the General Agreement on Tariffs and Trade (to which the United States is a signatory).

This does not necessarily mean that the tariffs will be revoked! The United States may appeal this ruling, which could suspend application of the ruling.

The U.S. Trade Representative has objected to the WTO Appellate Body, claiming that it has failed to follow agreed-upon rules. In 2016 (during President Obama’s term) the United States blocked the appointment of a WTO Appellate Body judge. The Administration of President Trump has continued this practice and it now appears that the United States’ blockage will result in the body being unable to conduct business. Which could mean that a US appeal would never be heard. rendering the WTO ruling effectively moot.

So keep paying those tariffs for imports – at least until you hear that the law has changed!