Senators urge reform of tariff waiver bill

WASHINGTON Wed Jul 11, 2012 5:49pm EDT

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WASHINGTON (Reuters) - A bipartisan pair of senators on Wednesday pushed for a vote on an amendment they said would reduce the role of lobbyists in crafting routine trade legislation that faces a battle this year because of concerns raised by conservatives.

"Job creators are seeking relief from high tariffs to provide the certainty necessary to hire workers and grow their companies, but the process needs to be reformed," said Senator Rob Portman, an Ohio Republican.

Portman, a former U.S. trade representative, and Senator Claire McCaskill, a Missouri Democrat, said they hoped to offer their amendment to a small business bill in the Senate and would push for other chances if that effort failed.

Their provision would reform the process for crafting the so-called "Miscellaneous Tariff Bill" (MTB), passed every few years by Congress, that temporarily suspends import duties on certain chemicals, raw materials and other production materials not manufactured in the United States.

Only "non-controversial" items are included in the MTB, meaning revenues lost from the duty suspensions are less than $500,000 per product and there is no domestic opposition.

The bill is a priority for the U.S. Chamber of Commerce and the National Association of Manufacturers, which say it is needed to ensure U.S. firms remain competitive.

However, some conservative lawmakers, such as South Carolina Senator Jim DeMint, consider the tariff suspensions to be "earmarks," which Republicans have sworn to oppose.

Supporters reject that charge, saying any company can enjoy the duty suspension once it is approved and that U.S. consumers benefit generally from the lower costs that ensue.

McCaskill told reporters the current process for crafting the MTB bill requires companies to "come begging on Capitol Hill" for a lawmaker to introduce legislation to suspend tariffs on a particular product.

"The process is not something that's transparent and there's a lot of political fundraising wrapped up in this ugly stew," McCaskill said.

The individual tariff bills are sent to the U.S. International Trade Commission, which evaluates them to see if they meet the necessary criteria.

Those that qualify are bundled into a big legislative package by the House of Representatives Ways and Means Committee and the Senate Finance Committee.

Portman and McCaskill's amendment would allow companies, as well as members of Congress, to submit requests for duty suspensions directly to the International Trade Commission. The ITC would then craft a draft bill based on the requests.

Without the reform, the MTB is unlikely to pass this year, Portman said.

Aides on both the Senate Finance Committee and the House Ways and Means Committee defended the current process, which they said was transparent and had bipartisan support.

The proposed change would "make it harder for small businesses and job creators who don't have experience dealing with complex Washington-based bureaucracies, but do know their local member of Congress or senator," Ways and Means Committee spokeswoman Sarah Swineheart said.

She argued that companies would still need lobbyists to make their case to the ITC and other parts of the federal government involved in the review process, but those would not be subject to the same scrutiny as lobbying before Congress.

"So we'd end up with the same lobbying, but less transparency," Swineheart said.

Congress would also be giving up some of its constitutional jurisdiction over trade under the plan, she said.

(Reporting by Doug Palmer; Editing by Dan Grebler)

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