Lawmakers urge study of Obama "tire tax" impact

WASHINGTON Thu Jan 21, 2010 6:13pm EST

WASHINGTON (Reuters) - Two U.S. lawmakers called on Thursday for a government report on the economy-wide effects of a 35 percent tariff that President Barack Obama imposed on tire imports from China.

"I am concerned that the administration's tire tax will cost us jobs in the United States and raise prices for tires for hardworking Americans," Representative Kevin Brady, a Texas Republican, said in a statement.

"I want to make sure that the administration has all the facts so that it can best determine how and when to end that tax," Brady said.

Obama imposed the import tax in September at the behest of union workers at U.S. tire plants who said their jobs were threatened by imports from China. None of their employers requested the relief.

The duty declines to 30 percent in the second year and 25 percent in the third, after which it is scheduled to be removed.

Brady said the administration should consider ending the tax earlier if it is hurting American consumers and not delivering promised new jobs.

He and Representative Dan Boren, an Oklahoma Democrat, urged U.S. Trade Representative Ron Kirk to establish a comprehensive monitoring system to assess the impact of the import tax on U.S. employment, tire prices and auto safety.

They said they had seen reports of significant tire price increases in many areas of the country, including poorer neighborhoods, and anecdotal evidence of layoffs in tire distribution and retail sectors.

A spokeswoman for Kirk's office said it was reviewing the lawmaker's letter.

(Reporting by Doug Palmer; Editing by Peter Cooney)