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Fabric Executives’ Predictions Differ as Countdown on New Chinese Tariff Looms

By RAY PARKER

July 24, 2018

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Government officials are now taking public comments until August 30, after which there could be a 10 percent tariff on upholstery, decorative fabrics, and other material made in China.

“Clearly it will drive up costs and hurt margins,” Cary Kravet, president of Kravet Fabrics, said. “Both consumers and companies will feel some effects.” The short-term effects will be higher costs, but industry officials have differing opinions about the tariff’s effects in the future.

In May, the US Trade Representative’s office in Washington, DC, held hearings on the proposed tariffs, specifically President Donald Trump’s plan to levy $50 billion in tariffs on China for unfair trade practices under Section 301 of the 1974 Trade Act. Auggie Tantillo, president and chief executive of the National Council of Textile Organizations, said in May that the US textile industry “strongly supports the Trump administration’s case to sanction China’s rampant intellectual property rights theft.”

“China’s domination of global textile markets has clearly been aided by its rampant theft of US textile intellectual property,” Tantillo said, according to The Associated Press. “From the violation of patents on high-performance fibers, yarns, and fabrics, to the infringement of copyrighted designs on textile home furnishings, China has gained pricing advantages through blatantly illegal activities.”

For Kravet Fabrics, the new tariffs lack precedent, something Kravet has been reflecting on this year as he celebrated the company’s centennial. Kravet, Inc., is a home-fashion brand that distributes fabrics, furniture, wall coverings, trimmings, carpets, and accessories. The Kravet design studio is based in New York City, with warehouses in Long Island and South Carolina.

“This is ill-advised, economically,” Kravet said. “In addition, the power to impose the tariffs is not what the writers of the Constitution intended, or what Congress has subsequently expected in their authorizations by law.” Still, Kravet said he does not think the new tariff will have a huge impact on his business and others like it. “At 10 percent,” Kravet said, “it will not be particularly painful for most in our industry segment.” 

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To comment on the tariff issue, call 877-378-5457 for the help desk of Regulations.gov.

To view the public comments made in May to the US Trade Representative’s office, log onto Regulations.gov and enter docket number USTR-2018-0005.


Edmund Bell
Design A Bord
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