As is so often the case, those closest to the situation can describe it the best. A retailer stuck paying GSP tariffs on shipments coming in for the holiday season emailed us the following:
“Assuming the GSP will eventually pass and be retroactive, we are bearing the higher costs during our busiest season, and will pay additional administrative staff to recover the refunds. The government is also incurring costs to keep track of the duties paid, and then to administer the refunds. There is no gain for any party here.
If the GSP is not reinstated, we will stop ordering this specific [merchandise] from the GSP countries, and probably buy from China if possible. We will not be able to continue to absorb the costs, or pass it along to the consumer, based on our price points.”
In short, GSP expiration makes: 1) companies waste time and money, 2) the government waste time and money, and 3) importing from China more attractive.
We get the feeling that anyone running for Congress on that platform wouldn’t get too many votes…