As reported in December 2020, after intensive Section 301 review, the Office of the U.S. Trade Representative (USTR) announced its determination that France’s 3% Digital Services Tax (DST) is unreasonable, discriminatory and creates restrictive burden on U.S. commerce; and decided to take action in the form of additional duties of 25% on French products.
Signed into law on July 24, 2019, France imposed a 3% DST on resident and non-resident digital companies providing advertising services, selling user data for advertising purposes, or performing intermediation services.
The Section 301 action permitted a 180-day suspension period ending today, January 6, 2021, in order to enable bilateral negotiations.
Now, due to setbacks, French authorities have begun issuing collection notices to U.S. companies for DST taxes, while the USTR allows the suspension deadline to lapse enabling 25% Section 301 tariffs on luxury goods, such as handbags, make-up, and soaps.
July 10, 2020: The U.S. Trade Representative determined to take action in the form of additional duties of 25 percent on products of France specified.
January 6, 2021: The end of the 180-day suspension period for the additional duties.
LIST OF FRENCH PRODUCTS SUBJECT TO 25% DUTIES
- 3304.10.00 – Lip make-up preparations
- 3304.20.00 – Eye make-up preparations
- 3304.30.00 – Manicure or pedicure preparations
- 3304.91.00 – Beauty or make-up powders, whether or not compressed
- 3304.99.50 – Beauty or make-up preparations & preparations for the care of skin, excl. medicaments but incl. sunscreen or sun tan preparations, nesoi
- 3401.11.10 – Castile soap in the form of bars, cakes or molded pieces or shapes
- 3401.11.50 – Soap, nesoi; organic surface-active products used as soap, in bars, cakes, pieces, soap-impregnated paper, wadding, felt, not for toilet use
- 3401.19.00 – Soap; organic surface-active products used as soap, in bars, cakes, pieces, soap-impregnated paper, wadding, felt, not for toilet use
- 3401.20.00 – Soap, not in the form of bars, cakes, molded pieces or shapes
- 3401.30.10 – Organic surface-active products for wash skin, in liquid or cream form, contain any aromatic/mod aromatic surface-active agent, put up for retail
- 3401.30.50 – Organic surface-active products and preparations for wash skin, in liquid or cream form, put up for retail sale, nesoi
- 4202.21.30 – Handbags, with or without shoulder strap or without handle, with outer surface of reptile leather
- 4202.21.60 – Handbags, with or without shoulder strap or without handle, with outer surface of leather, composition or patent leather, nesoi, n/o $20 ea.
- 4202.21.90 – Handbags, with or without shoulder strap or without handle, with outer surface of leather, composition or patent leather, nesoi, over $20 ea.
- 4202.22.15 – Handbags, with or without shoulder strap or without handle, with outer surface of sheeting of plastics
- 4202.22.40 – Handbags, with or without shoulder strap or without handle, with outer surface of textile materials, wholly or in part of braid, nesoi
- 4202.22.45 – Handbags, with or without shoulder strap or without handle, with outer surface of cotton, not of pile or tufted construction or braid
- 4202.22.60 – Handbags, with or without shoulder strap or without handle, outer surface of veg. fibers, exc. cotton, not of pile or tufted construction or braid
- 4202.22.70 – Handbags, with or without shoulder strap or without handle, with outer surface containing 85% or more of silk, not braided
- 4202.22.81 – Handbags, with or without shoulder strap or without handle, with outer surface of MMF materials
- 4202.22.89 – Handbags, with or without shoulder strap or without handle, with outer surface of textile materials nesoi
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