Proposal to increase tariffs for Chinese drones in the US

WASHINGTON (Originally published by Reuters) – A group of House Representatives from the Republican Party in the USA on Wednesday proposed legislation that would hike tariffs on Chinese-made commercial and recreation drones by 30 percent, and bar imports of drones that contain critical components made in China by 2030.

The legislation led by Representative Elise Stefanik would also create a new grant program for first responders, critical infrastructure providers, and farmers and ranchers to get assistance in purchasing U.S. made drones.

The proposal would hike tariffs on Chinese-made drones by 30 percent initially and then hike them by five percent annually. It also sponsored by House China Committee select chair John Moolennar.

Stefanik said the bill will “increase the competitiveness of US drone manufacturers by establishing a revenue neutral grant program to help Americans purchase drones securely made by the U.S. and our allies.”

In March, a bipartisan group of U.S. lawmakers asked the Biden administration to impose higher tariffs on Chinese drones, including those shipped from other countries, and new incentives to boost U.S. drone manufacturers.

The lawmakers urged immediate action against Chinese drone makers, including DJI and Autel (688208.SS), and said the current 25 percent additional tariff on Chinese drones is “insufficient to combat the surge” in imports.

Chinese drone companies hold more than 77 percent of the US hobby drone market and over 90 percent of the market for commercial drones, lawmakers said.

DJI said in March it opposed restrictions based on country of origin and said it closely follows “all applicable data privacy protection laws, regulations, and norms in the US and anywhere else we operate.”

In November, the committee and other lawmakers asked the Biden administration to investigate and potentially sanction Autel Robotics, and lawmakers introduced legislation seeking to ban the US government from buying Chinese drones.

The US Congress in 2019 banned the Pentagon from buying or using drones and components manufactured in China.

Aviation legislation set to be approved by Congress Wednesday will prohibit the Transportation Department from buying or offering grants for Chinese-made drones but provides exemptions and waivers in limited scenarios.

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