FDRA Says TPP Would Rein in Record and Increasing Duties on Children's Footwear
The Trans-Pacific Partnership (TPP) would cut duties on children’s footwear imports by $125 million in the first year of implementation and result in $1.5 billion in direct savings on such duties after the deal’s 12-year phase-in, as total tariffs on children’s footwear have risen 191 percent since 2005, according to a report by the Footwear Distributors and Retailers of America (here). All but 0.1 percent of children’s shoe imports face duty rates upwards of 37.5 percent to 67.5 percent, while other imported consumer goods are tariffed, on average, at 1.3 percent, FDRA said. The group argued that the tariffs miss their intention of attempting to protect domestic industry, as the U.S. hasn’t mass-produced children’s shoes in more than 30 years.
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In 2015, the U.S. imported 527.8 million pairs of children’s shoes, which saw a combined $307 million in duties, which is a record high and a $37 million increase over 2014, according to FDRA estimates. Such duties will likely increase to $320 million this year, the trade group said. “Footwear duties, like all costs, are multiplied at retail,” the report says. “These costs also include warehouse, transit, marketing, inventory and labor costs, all impacting the final footwear retail price. With the industry paying $2.9 billion in import taxes, it really amounts to almost $8.7 billion in extra costs for consumers, with families paying $921 million more for children’s shoes at retail in 2015 than needed.” TPP, if implemented, would help chop perennially increasing tariffs on footwear imported from countries like Vietnam, where production is growing, FDRA said, resulting in consumers paying an average of $2 to $4 less at retail for shoes made in the country. The group also urged readers of the report to convey the expected financial benefits of TPP to U.S. lawmakers.