The U.S. Trade Representative (USTR) announced they are suspending the onset of twenty five percent additional Section 301 tariffs that were proposed for certain products from Austria, India, Italy, Spain, Turkey and the United Kingdom, due to their implementation of a Digital Service Tax (DST). Tariffs will be suspended for 180 days, until November 29, 2021, to allow negotiations to continue.
In additional the USTR reduced the quantity of affected tariff subheadings for all countries, with Austria reduced from 40 to 23 subheadings, India reduced from 40 to 26 subheadings, Italy reduced from 59 to 44 subheadings, Spain reduced from 36 to 27 subheadings, Turkey reduced from 45 to 32 subheadings, and the United Kingdom reduced from 69 to 67 subheadings.
The DST estimated trade value for calendar year 2019 for each country is approximately:
- $65 million for Austria
- $119 million for India
- $386 million for Italy
- $324 million for Spain
- $310 million for Turkey
- $887 million for the United Kingdom
Reports and notices on the DST investigations are available here.
Digital Service Taxes are used by foreign countries to generate revenue by targeting large U.S. bases technology companies. Section 301 is used to level the playing field on burdensome or unfair restrictions of U.S. commerce.
If you have any questions regarding possible future Section 301 duties on certain imports as a result of Digital Service Tax, please contact your Livingston account manager.