President Signs MTB, Touts Duty Breaks as Part of Effort to Increase Exports

President Obama signed into law Aug. 11 the Manufacturing Enhancement Act of 2010, otherwise known as the miscellaneous trade bill (H.R. 4380). The president touted the MTB as part of his effort to double U.S. exports within five years, an initiative that some observers said could now be further advanced by implementing pending free trade agreements with Colombia, Panama and Korea.

The MTB extends through Dec. 31, 2012, retroactive to Jan. 1, 2010, hundreds of duty suspensions and reductions on imported manufacturing inputs and other goods that expired Dec. 31, 2009. Importers of goods that lost their duty-free status when the last MTB expired now have 180 days to file for a refund of all duties paid on such imports since Jan. 1. Such refunds are available even if an entry has been liquidated for more than 180 days. For entries not yet liquidated, ST&R’s Trade and Politics Blog states that importers may want to notify the ports where their goods entered to make sure they are liquidated with a refund.

The MTB also includes new duty breaks for various products that will take effect Aug. 26. In addition, congressional staff are working to have a second MTB later this year that would include even more new tariff suspensions.

In remarks prior to signing the bill the president asserted that the MTB will contribute to his goal of doubling U.S. exports in order to increase domestic employment. Specifically, he said, the MTB “will make it cheaper and easier for American manufacturers and American workers to do what they do best: build great products and sell them around the world.” He explained that the bill will reduce or eliminate tariffs on materials that manufacturers have to import from other countries, which in turn “will significantly lower costs for American companies across the manufacturing landscape – from cars to chemicals; medical devices to sporting goods.” As some observers have pointed out, this is one of the few times the president or a member of his administration has spoken about the positive role of imports in economic recovery efforts.

Some lawmakers and business groups used the signing of the MTB to call on the president to take additional actions to increase exports. The National Association of Manufacturers pointed out that the MTB “does not address the lowering of trade barriers to U.S. exports shipped to foreign markets,” where the U.S. is competing with others for 95% of the world’s consumers. NAM, along with Sen. Charles Grassley, R-Iowa, and House Minority Leader John Boehner, R-Ohio, therefore called on the administration to enact agreements that will address these barriers, including the pending FTAs with Colombia, Panama and Korea and the Trans-Pacific Partnership Agreement currently under negotiation.