Author: Ana Swanson and Lazaro Gamio
Published on: 27/05/2025 | 00:00:00
AI Summary:
Trade Crime Is Soaring, U.S. Firms Say, as Trump’s Tariffs Incentivize Fraud President Trump's steep global tariffs have supercharged efforts to evade them. Some U.s. Companies say the government is ill equipped to keep up. The vice president of marketing and government affairs at Charlotte Pipe and Foundry, a 124-year-old manufacturer based in Charlotte, N.C., described the government’s efforts to shut down Chinese companies engaging in companies may be dodging tariffs by altering information about shipments given to the U.S. Government to qualify for a lower tariff rate. Or they may move the goods to another country that is subject to a higher tariff before shipping them to the United States. The Trump administration said this month that it would focus more on combat trade fraud, including tariff evasion. In his first months in office, Mr. Trump put a 10 percent tariff on most products globally. He raised, lowered and suspended tariffs for various countries with little warning. Some companies suspended orders in the face of the tariffs. Trump’s Tariffs Drive a Rise in Trade Crime - The New York Times A third method involves sending the products to another country before they go to the United States to take advantage of different tariff rates applied to different countries. The U.S. Charges tariff rates based on where a good was last manufactured. If the company takes parts of a shoe made in China and puts them together in Malaysia, the shoe may technically qualify as Malaysian. But if a product is manufactured in China, that is a violation of U.S. Law. One ad sent to an importer this spring explicitly advertised this scheme. Chinese companies are now marketing a method that reduces the U.S. Importers’ legal liability for tariff fraud. In this case, the Chinese company acts as the US importer, retaining ownership of the good as it is shipped across the ocean and into the United States. Customs and Justice Department officials have been reassigned to work on immigration and other issues in recent months. Many U.S. Firms that have seen their business hurt by trade crime have been left deeply frustrated after trying to work with the government. Trump’s use of tariffs to crack down on unfairly made imports was “whipsaw and shoot from the hip” and that the situation called for broader action. “We need Congress to step in and do something more comprehensive, so the president doesn’t have to go around shooting first and asking questions later,” he said. Trump has changed up his tactics with China, backing off his highest tariffs. BYD of China leapfrogged Tesla for the first time, in what an analyst called a “watershed moment” for the continent’s auto market.
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