Some medias quoted informed sources and reported that the United States may announce the cancellation of some tariffs on China as soon as this week, but due to serious differences within the Biden administration, there are still variables in the decision, and Biden may also offer a compromise plan for this.

In an effort to ease record inflation in the U.S., the Biden administration has been at odds for a long time over whether to lift some tariffs on China. U.S. President Joe Biden may announce as soon as this week that he will withdraw some of the tariffs imposed on China during the administration of former President Donald Trump, according to the latest reports from multiple media outlets. The Washington Post reported on July 4, citing people familiar with the matter, that Biden has been deliberating on this matter in recent weeks and may announce a decision as soon as this week. Exemptions from tariffs on Chinese imports are restrictive and limited to goods such as clothing and school supplies. In addition, the U.S. government plans to introduce a mechanism to allow exporters to apply for tariff exemptions on their own. However, Biden has so far been slow to make a decision due to differences of opinion within the administration.

The Wall Street Journal reported that the U.S. Trade Representative’s office is conducting a quadrennial mandatory review of Trump-era tariffs on China. The comment period for businesses and others benefiting from the tariffs ends on July 5, which is also a timing point for a Biden administration to adjust policy. The decision, once made, will end a four-year trade war. A decision to ease Chinese import restrictions has been delayed several times over disagreements among White House officials.

In recent weeks, the U.S. inflation crisis has continued to heat up, and public opinion has demanded that the government lower the prices consumers need to pay for daily commodities and solve the price problem, which has brought considerable pressure to U.S. officials. To this end, the possibility that the Biden administration will consider easing some tariffs on $300 billion of Chinese imports has also increased.

According to Reuters, despite evidence that inflation may have peaked and the worst may be over, U.S. data in May showed that inflation, as measured by the price index for personal consumption expenditures, was 6.3 percent on a yearly basis, unchanged from April More than three times the Fed’s official 2% target, record inflation has done little to immediately ease the Fed’s tendency to hike rates again next month.

There has always been a huge disagreement within the U.S. government on cutting tariffs on China, which also adds to the uncertainty of whether Biden will announce the cancellation of tariffs on some Chinese goods. U.S. Treasury Secretary Janet Yellen and U.S. Commerce Secretary Gina Raimondo are inclined to cut tariffs on China to ease domestic inflation; U.S. Trade Representative Katherine Tai and others are concerned that canceling tariffs on China may make The United States has lost the weapon of checks and balances, and it will be more difficult to change the trade measures that the United States claims that China is not conducive to American companies and labor.

Yellen said that while tariffs are not a panacea for inflation, some existing tariffs are already hurting U.S. consumers and businesses. Commerce Secretary Raimondo said last month that the government had decided to keep tariffs on steel and aluminum, but was considering dropping tariffs on other goods. On the other hand, U.S. Trade Representative Dai Qi made it clear that she does not believe any tariffs will have an impact on price pressures. In a recent congressional hearing, she said “there are limits to what we can do about short-term challenges, particularly inflation.”

Bloomberg pointed out that while Biden is considering removing some tariffs on China, he also faces the risk of unions. Unions have opposed any such move, saying the tariffs would help protect jobs in U.S. factories.

According to official data, while China’s economy has been affected by the shutdown due to the new crown epidemic, in the first five months of 2022, China’s exports to the United States increased by 15.1% year-on-year in dollar terms, and imports increased by 4%. If Biden announced the removal of some tariffs on China, it would mark his first major policy shift in the trade relationship between the world’s two biggest economic powers.

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