The United States Trade Representative (USTR) has extended the “Section 301” tariff exemption for imports from China for nine months. The exemptions include 352 Chinese import categories, including printed circuit boards (PCBs) used to manufacture top-end graphics cards and other computer hardware.
In the early stages of the 2018 US-China trade war, President Trump imposed tariffs on many imported Chinese goods. In his March of this year, the USTR temporarily lifted Trump-era tariffs. However, his tariff exemption expires on December 31st, which could affect graphics card prices in 2023. Fortunately, the USTR has decided to extend the tariff exemption for another 9 months.
“These exclusions were originally reinstated on March 28, 2022. This extension will help align further consideration of these exclusions with the ongoing comprehensive four-year review,” it said. USTR states: press release (opens in new tab).
The USTR has initiated a four-year review of the effectiveness of Section 301 tariffs on Chinese products. A completed first phase allowed stakeholders who would benefit from the tariff to make their case as to why they wanted to keep the tariff. Phase 2, which ends on January 17, 2023, will allow all parties, including opponents of tariffs, to comment. Unfortunately, the USTR hasn’t shared its review results, so it’s still inconclusive as to whether the Biden administration will keep or repeal tariffs.
Not all manufacturers make their graphics cards in China, but the majority do. The sad thing is that companies are more likely to push tariffs onto consumers. Vendors such as Asus and MSI, for example, were raising his MSRP on graphics cards before the tariff exemption. Shortly after the USTR lifted import tariffs, Asus announced price cuts of up to 25% for its graphics cards.
High-end graphics cards such as the GeForce RTX 4090 and Radeon RX 7900 XTX already cost a fraction of a penny. If tariffs were to return, the consumer would have to pay 25% more cash for the same graphics card regardless of tier. For example, the GeForce RTX 4090 has a suggested retail price of $1,599, but suddenly it’s nearly $2,000. There is nothing to do but sit back and see if the tariffs take hold. If things go wrong, you have a grace period of at least nine months.