Before the pandemic brought unprecedented disruptions in every possible way, the added expense of tariffs was a primary concern. Now that the industry has a better handle on managing pandemic-related challenges and there is hope on the horizon with a vaccine, tariffs are once again a main topic of discussion and speculation.
Wilson Lau, Vice President of Nuherbs, talked to Nutritional Outlook, who provides insights and industry updates critical to manufacturers of dietary supplements, healthy foods, and nutritious beverages, about what the industry might expect this year.
- No progress has been made on the tariffs front since last year. The additional, tacked on fees holding are at 25% for imported herbs and herbal materials. Extracts are still levied at 7.5% ( which was we’ve seen since 2020).
- Depreciation of the value of the U.S. dollar will make financial burdens heavier in 2021. Since the beginning of this year, the value of the US dollar has dropped 7%, and factoring in the tariffs means prices are around 9% higher.
- Tariffs could be repealed as a countermeasure if there is a global economic downturn. While the haphazard implementation of the previous administration’s tariffs created uncertainty, the pandemic caused more disruption. If the combination leads to a global economic downturn, a repeal is possible.
- Industry leaders are actively reaching out to legislators in the new administration for support. It remains to be seen how the Biden administration will approach the tariffs, but the industry is being proactive and citing the numerous jobs the industry creates and the overall positive impact the industry has on American’s health.
- The new Biden administration will bring predictability to tariffs in 2021. Unlike the previous administration, this year the industry can expect to know what, when, and how any new tariffs will be implemented, which is a definite improvement for business.
Read the whole article on Nutritional Outlook