Tariffs President Trump’s steep global tariffs have supercharged efforts to evade them. Some U.S. companies say the government is ill equipped to keep up. President Trump’s steep global tariffs have supercharged efforts to evade them. Some U.S. companies say the government is ill equipped to keep up. The vice president of marketing and government affairs at Charlotte Pipe and Foundry, a 124-year-old manufacturer based in Charlotte, N.C., described the U.S. government’s efforts to shut down Chinese companies engaging in trade fraud as “a game of Whac-a-Mole.”Credit…Video by Travis Dove Supported by By Ana Swanson and Lazaro Gamio Ana Swanson covers international trade and is based in Washington. Lazaro Gamio is a graphics editor. As President Trump’s tariffs have ratcheted up in recent months, so have the mysterious solicitations some U.S. companies have received, offering them ways to avoid the taxes. Shipping companies, many of them based in China, have reached out to U.S. firms that import apparel, auto parts and jewelry, offering solutions that they say can make the tariffs go away. “We can avoid high duties from China, which we have already done many in the past,” read one email to a U.S. importer. “Beat U.S. Tariffs,” a second read, promising to cap the tariffs “at a flat 10%.” It added: “You ship worry free.” “Good News! The tariffs has been dropped finally!” another proclaimed. The proposals — which are circulating in emails, as well as in videos on TikTok and other platforms — reflect a new flood of fraudulent activity, according to company executives and government officials. As U.S. tariffs on foreign products have increased sharply in recent months, so have the incentives for companies to find ways around them. The Chinese firms advertising these services describe their methods as valid solutions. For a fee, they find ways to bring products to the United States with much lower tariffs. But experts say these practices are methods of customs fraud. The companies may be dodging tariffs by altering the information about the shipments that is given to the U.S. government to qualify for a lower tariff rate. Or they may move the goods to another country that is subject to a lower tariff before shipping them to the United States, a technique known as transshipment. DECLARED Value TOTAL Tariff RATE TARIFF DUE Description Plastic shell suitcase from China $10 75% $7.50 Legal Plastic shell suitcase from China $5 75% $3.75 Illegal Artificially reduced value leads to a lower tariff Legal Illegal Plastic shell suitcase from China Plastic shell suitcase from China DESC. $5 $10 DECLARED Value TOTAL Tariff RATE 75% 75% $3.80 $7.50 TARIFF DUE Artificially reduced value leads to a lower tariff Note: The declared value of the goods in these examples are illustrative. Tariff rates are from the United States Harmonized Tariff Schedule. DECLARED Value TOTAL Tariff RATE TARIFF DUE Description A polyester shirt from Bangladesh $10 42% $4.20 Legal A cotton shirt from Bangladesh $10 29.7% $2.97 Illegal Intentionally misclassified product leads to a lower tariff Legal Illegal A polyester shirt from Bangladesh A cotton shirt from Bangladesh DESC. DECLARED Value $10 $10 42% 29.7% TOTAL Tariff RATE $2.97 $4.20 TARIFF DUE Intentionally misclassified product leads to a lower tariff DECLARED Value TOTAL Tariff RATE TARIFF DUE Description Stuffed toy from China $10 30% $3 Legal Stuffed toy from China, routed through Vietnam $10 10% $1 Illegal Incorrect origin country leads to a lower tariff Legal Illegal A stuffed toy from China A stuffed toy from China, routed through Vietnam DESC. DECLARED Value $10 $10 10% 30% TOTAL Tariff RATE $1 $3 TARIFF DUE Incorrect origin country leads to a lower tariff Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times. Thank you for your patience while we verify access. Already a subscriber? Log in. Want all of The Times? Subscribe.
Trump’s Tariffs Drive a Rise in Trade Crime
