Major carmakers suing US government over China tax

Major carmakers sue US government over China tax
The US and China have imposed border taxes on each other's goods and services as part of a trade war. Source: Getty Images
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Daily US Times: Major carmakers are suing the US government over the import taxes it has imposed on Chinese parts.

Mercedes-Benz, Tesla, Volvo, Ford are all unhappy with the customs duties introduced by the Trump administration and are demanding refunds.

China and the US have imposed border taxes on each other’s goods and services as part of a trade war.

Tensions between the two superpowers have rapidly escalated in recent weeks, mainly concerning technology firms.

The lawsuits were filed by the carmakers in the past few days in the New York-based Court of International Trade.

In its filing, Mercedes-Benz accused Washington of “prosecution of an unprecedented, unbounded, and unlimited trade war impacting over $500bn in imports from the People’s Republic of China”.

Electric vehicle giant Tesla in its filing called the tariffs “arbitrary, capricious, and an abuse of discretion”.

According to the filing, founder Elon Musk wants the tariffs cancelled along with a “refund, with interest” of import taxes paid.

The trade war between the US and China began in 2018 between the world’s two biggest economy.

US President Donald Trump has long accused China of intellectual property theft and unfair trading practices.

In China, there is a perception that America is trying to curb its rise as a global economic superpower.

Early this year the Washington and Beijing their “phase one” deal that partially ended the dispute. The US backed down on tariffs on $160bn in Chinese goods, particularly consumer electronics.

However, tensions between the two countries have massively ramped up since.

The World Trade Organization (WTO) ruled earlier this month that tariffs the US imposed on Chinese goods were “inconsistent” with international trade rules.

The WTO said the United States did not provide evidence that its claims of China’s unfair technology theft and state aid justified the border taxes.

But in retaliation to that, the US said that the WTO was “completely inadequate” to the task of confronting China.

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