US should reform existing China tariffs to target technology transfers, congressional panel hears
- Make ‘knowledge-intensive sectors’ a focal point and remove import taxes that offer no strategic value and hit working Americans hard, economist says
- If aim is to reduce sales of Chinese firms profiting from ill-gotten technology, coverage of such imports ‘should be increased’
The US should remove import taxes that offer no strategic value and to ease a burden felt by working Americans, according to Mary Lovely of the Peterson Institute for International Economics in testimony before the US-China Economic and Security Review Commission in Washington.
Asked what types of tariffs should be relied upon in such a reform, Lovely identified “knowledge-intensive sectors” and those “where we think China [and] Chinese companies may have benefited from forced technology transfer,” referring to the technology and pharmaceutical sectors.
“We need to ask: why do we have a tariff on a tablecloth, but you do not have a tariff on a Fitbit or an Apple Watch? Why are we taxing the people who shop at Walmart, but we do not tax the people at the speciality store?” she asked, saying low-income families paid more in import taxes than the wealthy.
Lovely, a former economics professor at Syracuse University, said if the objective of imposing tariffs “is to reduce sales of Chinese firms that have profited from ill-gotten technology, coverage of high-technology imports should be increased”.
