Bipartisan legislation introduced Friday may provide the RV industry with a solution to trade tariffs paid the past three years on lauan imported from Indonesia.
RVIA estimates the industry has paid $1.5 million a month since 2020 on tariffs, primarily ones levied on lauan wood imports.
The legislation, called the CNL Update Act of 2023, looks to provide changes to the Generalized Systems of Preferences (GSP) federal program. GSP provides opportunities to import products from foreign countries without tariffs, but the program has not been renewed since 2020.
The CNL Update Act was introduced in the U.S. House by Rep. Blake Moore (R-Utah) and Rep. Suzan DelBene (D-Wash.). The legislation would alter aspects of the GSP governing Competitive Need Limitations (CNLs).
The CNLs provide import ceilings for imported products. Duty-free products are subject to tariffs when their import value exceeds the ceiling. GSP duty-free benefits also terminate when product imports from a certain country either account for 50% or more of the value the product’s total U.S. import value or they exceed a certain dollar value, which increases by $5 million annually.
The 2023 value cap is $210 million, following the same CNL guidelines that have been in place since 1996. The CNL Update Act will raise the import ceiling to $600 million—a 186% increase from the current threshold—and establish a 5% annual growth provision.
Without the CNL Update Act, the 2024 threshold would be $215 million, then $220 in 2025. With the legislation passed, the 2024 threshold would be $600 million, then $630 million in 2025.
RVIA President and CEO Craig Kirby said the legislation would remove and reform arbitrary limitations and reduce the RV industry’s costs and regulatory burdens.
“The RV industry applauds Reps. Moore and DelBene for introducing commonsense reforms that will not only help domestic manufacturers continue to utilize the program to obtain products unavailable in the U.S., but also further the goals of the program in supporting beneficiary countries,” Kirby said. “These reforms would ensure that the RV industry can continue our partnership with Indonesia, where we source lauan plywood— a key component used in many RVs— duty free.”
Moore and DelBene were among the House Ways and Means Committee members present for a September hearing on GSP modernization. During the hearing, a Utah-based manufacturer testified that higher CNL thresholds would encourage the company to set up permanent supply chains outside of China.
“Several economic sectors in Utah, including the outdoor recreation industry, rely on an effective and modernized Generalized System of Preferences program to do business,” Moore said. “This legislation will give Utah companies the flexibility they need to diversify their supply chains away from China and towards more reliable trade partners around the world.”
DelBene said the GSP program supports many industries but has aspects that are outdated.
“The legislation we are introducing today would modernize the program,” DelBene said, “helping create more jobs at home, strengthen American leadership abroad and reduce our dependency on China.”
