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SSC: Headnote 3(a) proposed amendment looks good
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Posted on Dec 10 2005
Saipan Chamber of Commerce president Alex Sablan said the prospects of amending the Headnote 3(a) of the U.S. Tariff Code to benefit insular areas, particularly the CNMI, are “looking good.
“The parties are back to meetings. The lobby for the amendment looks good especially when it is endorsed by both sides of the U.S. Congress,” said Sablan in a recent meeting.
He said the local business group hopes to see the amendment done soon.
The CNMI is asking the U.S. Congress to amend the law to reduce the value-added requirement on CNMI export products from 50 percent to 30 percent.
Currently, CNMI manufacturers are required to comply with the 50-50 value-added requirement.
Richard Pierce, governor’s special assistant for trade relations recently reported that work at the U.S. Congressional level continues on the amendment of the Commonwealth’s tariff entry privilege under General Note 3(a)(iv)(A).
This as Pierce reported that garment sales in Saipan garment factories continue to plummet since Jan. 1, 2005, or the effective date of the lifting of the worldwide trade quotas.
Pierce said the CNMI Customs Office’s International Textile Operations recorded apparel sales of $52.37 million for November 2005.
User fees collected by the government during the month totaled $1.93 million.
The government used to collect an average of $2.5 million a month prior to the trade liberalization.
User fee is assessed by CNMI Customs before export at 3.7 percent of invoice value.
Meantime, Pierce said that November’s sales of $52 million was 14 percent higher than the previous month and 23.6 percent down when compared to November 2004’s $63.8 million.
He said that factory sales for 2005 to date totaled $596 million, compared with $750 million for the first 11 months of 2004, a 20.6-percent decline.
Meantime, Pierce said that technical materials have been submitted to Congress for the discussion on S. 1954, the Insular Possessions Act of 2005, which was recently introduced in the U.S. Senate by Democrat Sen. Daniel Akaka from Hawaii and Idaho Sen. Craig.
Pierce said other U.S. insular area officials have offered support for S. 1954, including Guam, the U.S. Virgin Islands, and American Samoa.
