The Office of the United States Trade Representative is moving forward with the modifications to the tariffs included in its report following the review of the tariffs applied to Chinese goods under Section 301 of the Trade Act of 1974, including a new exclusion process for machinery and some tooling used in domestic manufacturing.
USTR has opened a comment portal for public input, not only on the increased tariffs proposed in the report but also on the products proposed for eligibility under the new exclusion process. The modifications proposed in the report include an increase in tariffs for 387 HTS codes (382 subheadings or 8-digit codes and 5 statistical reporting numbers or 10-digit codes), including 321 subheadings for steel and aluminum products. USTR is proposing to increase the tariff on these steel and aluminum products to 25 percent beginning on August 1, 2024. USTR is asking stakeholders to comment on the impact of the increased tariff on the U.S. economy and the effectiveness of raising the tariffs on the stated intent of the Section 301 tariffs to eliminate or counteract “China’s acts, policies, and practices related to technology transfer, intellectual property and innovation.”
USTR also invites interested parties to comment on the manufacturing machinery eligible under the new exclusion process, both those HTS codes included in the Section 301 report and any not included in the report that stakeholders believe should be included. One Voice asks PMA and NTMA to review the list of goods potentially eligible for an exclusion from the tariffs here.
The public docket opened on May 29, 2024, and will close on June 28.
Senate Republicans Form Tax Working Groups
Following the House Ways and Means formation of “tax teams,” Senate Finance Committee Republicans are forming tax working groups to study and develop legislative proposals to extend and improve the expiring provisions. The Republican members of the Finance Committee met on May 22, to discuss the tax cuts set to expire in 2025 and how to prepare for the negotiations in Congress next year regarding the roughly $4 trillion in tax increases scheduled for January 1, 2026.
According to Finance Ranking Member Mike Crapo (R-ID), the tax working groups will cover every aspect of the expiring provisions. Reports have identified the groups will specifically cover six areas, individual taxes, business measures, international tax, retirement, community development, and energy.
Business Groups File Lawsuit Against OSHA Worker Walkaround
A coalition of business groups, supported by One Voice, filed a lawsuit against the Occupational Safety and Health Administration (OSHA) over the final rule to allow non-employee third-party worker representatives, including a union official at a non-organized facility or trial lawyer, to be present during OSHA inspections. The lawsuit filed on May 21, 2024, in the U.S. District Court for the Western District of Texas, alleges OSHA’s “Worker Walkaround Representative Designation Process” exceeds the agency’s authority.
The rule codifies a 2013 Obama-era OSHA guidance, the “Fairfax Memo,” which broadly interpreted the Occupational and Safety Health (OSH) Act of 1970 to allow union officials or community organizers to accompany CSHOs on walkaround inspections. That guidance was challenged by multiple parties in court before the Trump administration rescinded it in 2017.
In addition to exceeding its legal authority, the coalition lawsuit states that OSHA’s rule violates the Fifth Amendment, erroneously casts the action as only a clarification, and that the agency refused to prepare a regulatory flexibility analysis as required by law.
During the rulemaking process, One Voice along with coalition partners, argued that the rule is fatally flawed, fails to improve workplace safety and “undermines OSHA’s credibility by imposing workplace access to otherwise uninvited third parties.”
Plaintiffs are seeking injunctive relief to block OSHA’s enforcement of the new rule, which took effect on May 31, 2024.
House Begins FY25 Appropriations Process
The House Appropriations Committee has begun considering funding bills for fiscal year (FY) 2025. Approximately two months after President Biden released his budget request, the committee is now considering, amending, and approving appropriations bills for the next fiscal year, starting on October 1, 2024.
On May 23, 2024, the Committee approved allocations for each subcommittee. These allocations align with the spending caps set by last year’s debt limit bill and establish topline spending amounts for each federal agency. Under the 302(b) allocations, total defense spending is set at $895.2 billion, while non-defense funding is allocated $710.7 billion. The approved allocations include over $78 billion for the Commerce-Justice-Science bill and nearly $187 billion for the Labor-HHS bill, which fund critical job training and technical education programs.
The Committee has also released a mark-up schedule aiming for the full committee to approve all 12 annual funding bills by July 10, 2024. This is part of an aggressive plan by House Republican leadership to move all appropriations bills out of committee and pass them through the House before the August recess. The House will consider the first of the federal funding measures, the Military Construction-Veterans Affairs bill, on the floor this week. After this week, the House will have only 20 legislative days left before the August recess. Although Republican members of the House Appropriations Committee are optimistic about meeting their self-imposed deadline, internal disagreements on spending—similar to last year’s—could make it challenging to complete the government funding process in the House by the end of July.
Senators Introduce Supply Resiliency Bill Following House Passage
Senators Maria Cantwell (D-WA), chair of the Senate Commerce Committee, and Marsha Blackburn (R-TN) have introduced a bill to promote and strengthen domestic supply chains. The senators introduced the “Promoting Resilient Supply Chains Act” on May 21, 2024, after the House overwhelmingly passed a companion measure endorsed by One Voice on a vote of 390-19 on May 15.
The bill would create a “whole-of-government approach” to supply chain resiliency tasking the Industry and Analysis office of the Department of Commerce’s International Trade Administration (ITA) to monitor and respond to disruptions in critical industries and supply chains. The legislation creates a new program to include “expanded mapping and monitoring initiative, proactive work to address supply chain shocks before they occur, and engagement with key allies and international actors.”
The bill would also require the office to develop a national strategy to address supply chain resiliency and oversee the administration’s response to supply chain disruptions.