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To suspend normal trade relations with the People's Republic of China and to increase the rates of duty applicable with respect to articles imported from the People's Republic of China, and for other purposes.
2/5/2025, 9:05 AM
Summary of Bill HR 694
If passed, the bill would allow the United States to impose higher tariffs on goods imported from China, making it more expensive for American companies to import products from Chinese manufacturers. This could potentially lead to a decrease in trade between the two countries and impact the global economy.
Proponents of the bill argue that China has engaged in unfair trade practices, such as intellectual property theft and currency manipulation, which have harmed American businesses. They also point to China's poor human rights record, including its treatment of ethnic minorities and political dissidents, as reasons to suspend normal trade relations. Opponents of the bill, however, warn that increasing tariffs on Chinese goods could lead to a trade war between the two countries, resulting in higher prices for American consumers and potentially harming the US economy. They also argue that cutting off trade with China could have negative diplomatic consequences and strain relations between the two countries. Overall, the China Trade Relations Act is a controversial piece of legislation that highlights the complex relationship between the United States and China. It remains to be seen how Congress will ultimately decide on this bill and what impact it will have on trade relations between the two countries.
Congressional Summary of HR 694
Restoring Trade Fairness Act
This bill establishes various trade measures related to China, including by revoking China's permanent normal trade relations (PNTR) status and increasing the rates of duty (i.e., tariffs) on Chinese imported goods. The bill prohibits imported goods originating from North Korea, China, Russia, or Iran from receiving de minimis treatment. (Current law allows for U.S. imports under a de minimis threshold of $800 per shipment to enter free of tariffs, fees, and taxes.)
Specifically, the bill revokes China's PNTR status. Currently, China's PNTR status allows for Chinese goods to have duty rates set forth in column 1 of the Harmonized Tariff Schedule of the United States (HTS). With the removal of China's PNTR status, the bill generally sets the applicable duty rates on imported Chinese goods at the higher rates listed in column 2 of the HTS, with exceptions.
The bill establishes a minimum duty rate of 35% for all Chinese goods, which requires column 2 rates to be at least 35%. However, the bill establishes a minimum duty rate of 100% for a list of specified goods (e.g., various minerals, certain vaccines and drugs, and certain defense-related articles). Duty rates are phased in over five years and adjusted annually for inflation.
The bill also
- authorizes the President to take additional actions related to trade with China,
- requires merchandise imported from China to be appraised based on U.S. value, and
- establishes a trust fund to compensate U.S. producers for lost revenue resulting from retaliatory actions by China.
