China exempts US goods from tariffs and duties, relief to traders

On Thursday, China announced a list of American goods that will not be levied with import tariffs. The latest development comes on the back of Washington and Beijing reaching a trade agreement last week. The United States of America and China were involved in an intense trade war since 2017 by imposing duties on each other. 

China, on Thursday, released a list of products that will not be subject to tariffs. These products include specific types of adhesives, industrial glue, certain types of polymers, and paraffin, that is generally used in food and cosmetics. As per the Customs Tariff Commission of the State Council, the exemption will be effective from 26 December 2019 till 25 December 2020. 

Donald Trump, the US President, cancelled all new tariffs on the Chinese products last week after the conclusion of the phase-1 deal. China, in response to this, withdrew all measures it had taken to impose fresh tariffs and duties on the American goods. Traders much welcome the two powerhouses reaching an agreement.

Also Read: Global Trade War Between China and USA and How It Affects Gold

Nevertheless, the United States and China have not officially signed any agreement; it’s instead a mutual understanding as to end the trade war. Last September, China announced that it is going to exempt a total of 16 categories of American products from duties, including anti-cancer medications and seafood items. 

Earlier this month, China has said it would waive tariffs on some goods that are imported from the United States and it includes soybean and pork. The Chinese Government had tripled the tariffs on American pork ever since the trade war started. The United States too had imposed new duties and taxes on Chinese goods.

The trade standoff between China and the US had a significant impact on the emerging economies around the globe. Chinese yuan had depreciated and caused Indian rupee to plummet record levels against the greenback. China and the US reaching an agreement is welcomed globally. 

For any clarifications/feedback on the topic, please contact the writer at vineeth.nc@cleartax.in