On October 1, the details of the list of products with a "30 billion to 30 billion" equivalent tax reduction between China and the United States were officially announced:The US list covers 77 categories of goods, and the Chinese list covers 1619 categoriesMore than 90% of listed products will cancel mutual tariffs and restore the most-favored-nation tax rate. As soon as the news of the agreement came out on September 30, the details were implemented a day later-this rhythm itself is a rare market signal in the past few years. For the factory, the question now is no longer "whether it will be lowered", but "whether my product is on the list, when will it be lowered, and how to adjust the quotation."
1. What is included in both lists
The US list (tax reduction on imports from China) is almost entirely light industrial consumer goods:Toys, blankets, cutlery, artificial flowers, child safety seats, holiday decorationsand other categories 77. These are the categories in which the U.S. retail side has the most obvious feeling of price increases after the previous tariff increase, and they are also the categories with the most concentrated advantages in China's supply chain.
China's list (tax reduction on imports from the United States) has a wider scope, with a total of 1619 categories: fromAgricultural products, personal care productstowood--Pine, fir, spruce, hemlock, Douglas fir, oak, maple, cherry, ash, birch, poplar and other sawn timber categories are listed item by item--thenmedical devices, including high-value equipment such as surgical robots and MRI (magnetic resonance) equipment.
The signal given by this structure is very clear: the United States has produced the most sensitive light industrial products on the consumer side, and the Chinese side has produced high-end equipment and raw materials needed by the industrial side. Each other is taking a step first in the range of "having little impact on one's own people's livelihood and great export value to the other party"-this is a typical case of easy first and difficult later, and the remaining categories depend on subsequent rounds.
2. The factory checks its location in four steps
- Step 1: Lock your export tax number.Find out the HS code (8-10 digits for customs declaration) of the main products exported to the United States, and don't use the vague judgment of "probably belonging to the toy category." One digit difference in the tax number means two treatments.
- Step 2: Compare the US 77 category list.Compare the tax numbers on the list published by USTR one by one, and which models are present under the same tax number and absent number must be put on paper. It is recommended to ask freight forwarders or customs brokers to assist in confirmation in processing trade, complete sets of parts, etc.
- Step 3: Recalculate duty-paid costs for U.S. customers.Counting the landed costs before and after the tax reduction, the gap is the bargaining chip for negotiations in the fourth quarter. If the contract previously stipulated that "the buyer will bear part of the additional levy", there is now room for profit transfer; if it was agreed that the Chinese side will bear part of it, part of it can be negotiated back.
- Step 4: Write the tax reduction into the validity period of the quotation.The implementation of the list must be carried out simultaneously after completing their respective domestic legal procedures. Your quotation should state that "the price is based on the tariff level of month X, and will be adjusted according to the next round of quotation after the tax reduction is implemented" to turn the policy dividends into controllable contract terms.
There is another point that is easy to overlook: after the tax reduction is implemented, American customers will immediately increase their price comparison actions. In the past, buyers who transferred orders to Vietnam and India due to tariffs would re-examine the quotations of China suppliers-your old customers, lost customers, and customers with competing products would re-make inquiries within the same period of time. This means that the tax reduction dividend does not automatically fall to you, but to the factory with the "fastest response and the most complete information". There are two things that should be done on the day the list is released: pull out the list of lost American customers and reach it again; update all the prices, tax numbers, and compliance information in the English information package to the latest version, so that buyers can choose you at the lowest cost.
3. Timetable and Uncertainty
The lists of both parties need to be implemented simultaneously after completing domestic legal procedures. The US side also has procedures such as publicity, and the specific effective date will be based on subsequent announcements. Supporting mechanisms are also advancing: the two sides agreed to establish a dialogue on artificial intelligence risk and incident notification, led by U.S. Treasury Secretary Basent and Chinese leader He Lifeng, to hold the next dialogue before the end of November; the economic and trade teams of the two countries maintain close communication. Source:Time News reported on October 1 (citing USTR and the Chinese Ministry of Commerce).
There are two main uncertainties: first, during the legal process cycle,"tax reduction" should not be regarded as the default prerequisite for quotation and stocking; second, the list is only this round, and the remaining categories and review measures are still variables. The prudent approach is to arrange the fourth-quarter plan according to "tax reduction is an additional item, not a basic one."
4. A reminder to the market mix: When the dividends come, don't take back the basket
Moving production capacity from the U.S. market to factories in the Middle East, Southeast Asia, and Latin America in the past two years will make it easier to withdraw the basket when policies pick up. The suggestion is reversed: the U.S. market checks tax numbers according to the list and re-quotes to restore the share that should be restored; at the same time, it maintains channels that have been opened by emerging markets. The phased stability of Sino-US relations is the confidence to receive orders, not the reason to cut channels-the significance of a multi-market combination is that when the next round of fluctuations comes, you will have other cards in your hands.
common problems
1. Are there any opportunities for products that are not on the 77 category list?
There is a chance. This is the first round of the list. Both sides have clearly advanced it in batches in a reciprocal manner, and subsequent rounds may be expanded. It is recommended to also sort out the tax numbers that have not been included in the list, provide feedback on requests through chambers of commerce and industry associations, and at the same time reserve adjustment clauses after tax reduction in the quotation.
2. Can we quote at the tax reduction price after the list is announced?
Not recommended. The implementation of the list requires the completion of their respective domestic legal procedures and entry into effect simultaneously. The tariffs will remain at the original level before the effective date. The quotation can be given in two stages of "current price + estimated price after tax reduction", and the effective conditions can be clearly stated to prevent customers from suppressing the current price based on future prices.
3. What should toy factories do most now?
Three things: check the tax number to confirm the specific location in the list; pull out the list of U.S. customers previously lost due to tariffs and reach it again; simultaneously prepare compliance information (such as safety standards documents for the U.S. toy market), because after the tax reduction, competitors will also come back, and the person who resumes contact first will take the order first.
--Qihang AI Foreign Trade Research Institute·Let China Intelligent Manufacturing Set sail to the sea| Foreign trade customer consultation: 180-0327-6609
