Republican and Democratic lawmakers introduced a pair of companion bills on Thursday with a singular aim: to revoke the preferential trade status that China has held with the United States for the past two decades and strip it of the tariff and de minimis benefits it has enjoyed as a “most favored nation.”
The so-called Restoring Trade Fairness Act to End Permanent Normal Trade Relations Act, which was submitted to the Senate by Tom Cotton (R-Ark.), Jim Banks (R-Ind.) and Josh Hawley (R-Miss.), and to the House of Representatives by John Moolenaar (R-Mich.) and Tom Suozzi (D-N.Y.), comes on the heels of a memo that President Donald Trump issued on Monday to direct his cabinet to assess legislative proposals involving Beijing’s PNTR designation as part of his “America First” trade policy.
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China’s ascension to PNTR status in 2000, ahead of its entry into the World Trade Organization, “opened the door” for a “mass influx” of products that have undermined the U.S. manufacturing industry and “pillaged” American intellectual property through “economic coercion,” the bill’s sponsors said.
“The Restoring Trade Fairness Act is a critical step toward ending the unfair economic practices of the Chinese Communist Party that have hurt American workers and weakened our national security,” Moolenaar, who also chairs the House Select Committee on the Chinese Communist Party, said in a statement. “For too long, permanent normal trade relations with China have undermined our manufacturing base, shifted American jobs abroad, and allowed the CCP to exploit our markets while betraying the promise of fair competition. In response, this legislation will safeguard U.S. national security, enhance supply chain resilience and bring manufacturing jobs back to America and our allies.”
Cotton, echoing the same sentiments, said China’s PNTR designation has “enriched” the Chinese Communist Party at the expense of millions of American jobs. “This comprehensive repeal of China’s PNTR status and reform of the U.S.-China trade relationship will protect American workers, enhance our national security and end the Chinese Communists’ leverage over our economy,” he added.
The bill would kill PNTR for China by ending the annual Congressional vote for recertification. It would create a new tariff column for China, imposing a minimum 35 percent ad valorem tariff for non-strategic goods and a minimum 100 percent ad valorem tariff for all strategic goods based on the Biden administration’s Advanced Technology Product List and China’s Made in China 2025 plan. Ad valorem refers to an amount proportional to the estimated value of the goods or transaction. The rates would be phased in over five years with 10 percent of the tariff increase implemented in year one, 25 percent in year two, 50 percent in year four and 100 percent in year five.
The Restoring Fairness Act would also scupper de minimus treatment that allows covered nations such as China to sidestep taxes and duties—plus a tighter field of scrutiny—for shipments under $800. It would provide tariff revenue to U.S. farmers and manufacturers subjected to possible Chinese retaliation and help purchase munitions “vital to deterring CCP aggression in the Pacific,” the lawmakers said.
“This bipartisan bill makes the message clear—the Chinese Communist Party cannot receive preferential tariff treatment,” Suozzi, a member of the House Ways and Means Committee and co-founder and chair of the bipartisan Uyghur Caucus, said in a statement. “The Chinese Communist Party is engaging in unfair trade practices that devastate the American manufacturing industry’s ability to compete, contribute to the theft of American intellectual property and allow goods made with forced Uyghur labor in Xinjiang to enter our supply chain.”
Trump has long threatened increased duties on Chinese goods, which critics say will drive up costs for American consumers at the till. At one point on the campaign trail, he suggested punitive taxes as high as 60 percent, though the rhetoric has now appeared to soften to a possible 10 percent. Nations designated under PNTR pay an average tariff rate of roughly 3 percent, but this “perk” was essentially neutralized by Section 301 tariffs implemented during previous presidential terms, including Trump’s first.
The bill’s authors cited a 2023 International Trade Commission report, saying that it “confirms” that Section 301 tariffs on Chinese products have not contributed meaningfully to inflation. Instead, they said, these tariffs “encouraged a shift in supply chains” by reducing the United States’ reliance on Chinese imports in important sectors such as electronics, automotive parts and apparel. To wit: For every 1 percent increase in tariffs, imports from China fell by roughly 2 percent as U.S. importers adjusted and diversified their manufacturing, the report noted.
“The bipartisan consensus that both parties recognize the need to reset our economic relationship with China is a big win for our nation and the Select Committee,” Moolenaar said. “Building on the tariff measures across three successive administrations, and in alignment with President Trump’s leadership through his new executive order, the Restoring Trade Fairness Act takes decisive action.”
