President Donald Trump issued an Executive Order giving Treasury Secretary Steve Mnuchin the authority to defer certain duties and tariffs “for importers suffering significant financial hardship because of COVID-19.” The Treasury Department and U.S. Customs and Border Protection (CBP) announced the issuance of a joint temporary final rule providing importers the option for a 90-day deferment on the payment of duties, taxes and fees.

However, the order and final rule provide only limited, forward-looking relief, meaning no deposits of duties, tariffs or fees will be returned. The rule applies only to most-favored-nation tariffs codified in the standard U.S. tariff schedule. The exemption does not apply to antidumping and countervailing duties, national security duties on steel and aluminum, or the Section 301 tariffs imposed on Chinese-origin imports. “CBP anticipates that importers will file separate entries when a shipment contains both merchandise that is eligible for temporary postponement and merchandise that is ineligible (because of the above-specified trade remedies).”

To qualify for the extension, importers must “demonstrate significant financial hardship” by specifically establishing that their operations were fully or partially suspended in March or April due to lockdown orders stemming from COVID-19. This suspension must have resulted in the gross receipts for March 13-21 or in April 2020 being less than 60 percent of the gross receipts for the comparable period in 2019. Businesses will not need to submit documents to the government to qualify for an extension, but they must maintain these documents as part of standard record-keeping. The government is soliciting public comments for 30 days on this temporary rule.