Today we launched a new interactive map featuring first-of-its-kind research on the potential impacts of US tariff cuts under TPP for employers in all states.
The research is unique in several ways. First, it quantifies estimated tariffs paid on import from the so-called “new TPP” countries (i.e., Brunei, Japan, Malaysia, New Zealand, and Vietnam). Second, it uses the proposed US tariff reductions to show how those taxes could be reduced for employers in every state over the first five years of TPP implementation. Third, the research provides multiple examples of specific products imported into each state of products whose tariffs would be eliminated immediately upon implementation (e.g., Alabama’s imports of textile finishing dyes from Japan or Michigan’s imports of mufflers from Malaysia).
The interactive map highlights the top-line data for each state in terms of import taxes paid and potential tax cuts. For example, employers importing into Kentucky from new TPP countries paid an estimated $117 million in import taxes in 2015. If TPP were in effect, tariffs on those same products would be reduced by 90 percent by year five, potential saving Kentucky employers over $500 million along the way.
In addition to the “fast facts,” clicking on the map also provides an option to download the corresponding one-page fact sheet for each state (pictured). The fact sheets include addition details, such as how the tariffs paid would fall over time, the list of key products eligible for duty-free treatment, and the top sources for products currently facing import taxes.
Using Kentucky again: most tariffs would be eliminated immediately and the majority of tariffs paid are on imports from Japan. Numerous raw materials and components used by American manufacturers – such as metal-working machinery from New Zealand, wiring sets (auto parts) from Vietnam, and rubber gaskets from Malaysia – are among the Kentucky imports that would go duty-free immediately.
Perhaps surprisingly to many, there is tremendous variation between the states – and those differences are not just based on import volumes. For example, while more than 95 percent of imports into Alaska and West Virginia could be duty free by year 5, just 28 percent of imports into Hawaii could be eligible. we’ll be publishing several blog posts daily for the rest of the month to highlight some of the research for each state.