Almost as abruptly as it was taken off the table one month ago, US President Donald Trump has announced that the threatened next round of tariffs will come into effect on goods shipped from China by September 1.
It was only a matter of weeks ago that the industry’s concerns were somewhat abated during what seemed to be a cooling off period between the US and China, as trade talks restarted, with optimistic hints towards resolution.
The resumption of the trade war however, kicked off with the President’s tweet this week that while those talks will continue, the US will start putting an additional tariff of 10 per cent on the remaining $300 billion of goods and products coming from China.
“This does not include the $250 billion already tariffed at 25 per cent,” tweeted Trump.
Trump has blamed the Chinese government for not following through on a promise to purchase additional US agricultural products.
Notably, the tariffs now imposed on the remaining $300 billion of goods and consumer products is at 10 per cent, the lower end of the scale, avoiding the threatened 25 per cent tax. It is expected that the tax will affect all finished toys and games imported from China; the silver lining being that most Christmas products have now already been shipped.
The continuation of the talks and imposed tariffs has prompted the US toy industry body, the Toy Association, to kick start its own action, and has made its position that ‘tariffs hurt the American toy industry and the American families we exist to serve,’ clear from the outset.
“Through thousands of hours of advocacy, hundreds of meetings on Capitol Hill, multiple bipartisan letters from members of Congress to the Administration asking toys be held harmless from tariffs, a DC fly-in of member companies, and continual messaging through all forms of media, The Toy Association has been clear on this,” said Steve Pasierb, president and CEO of The Toy Association.
“Kindly and constructively providing facts, logic, detailed financial explanations, testimony, and first-hand stories from toy company and retail employers here in the United States apparently still cannot prevail over the power of the tweet.
“We will continue to advocate on behalf of our members, all in the toy, play and retail communities and the side of right.”
More than 600 companies and trade associations have joined to deliver a letter to the White House with a message: tariffs hurt the heartland.
Given the President’s propensity for a change of mind, and the lead up time to September 1, there’s a small chance that these taxes may still be avoided.