Senators aim to cut ‘shoe tax’
WASHINGTON – U.S. consumers would see a sharp drop in the price of imported shoes – and that’s nearly all shoes sold in the United States – if a bipartisan group of senators is successful in stamping out the nation’s “shoe tax.”
“It is kind of a hidden tax, and getting rid of it would be nice to do,” Democratic Sen. Maria Cantwell of Washington state, a member of the Senate Finance Committee, said Wednesday.
Cantwell has teamed up with Democratic Sen. Patty Murray of Washington state and Republican Sens. Roy Blunt of Missouri and Pat Roberts of Kansas to promote the Affordable Footwear Act, which would eliminate roughly half the duties on imported shoes.
Cantwell, the measure’s chief sponsor, said consumers were paying a tax of up to 40 percent in some cases. Backers said the legislation would lead to more sales for retailers and more savings for consumers.
While the bill has yet to arouse any opposition, it’s a hit with the shoe industry. Last year, it would have eliminated about $800 million of the $2 billion collected on imported children’s and low-cost shoes.
“It would be fantastic. … It would allow (consumers) to buy a second pair or buy a pair that they normally would have to put off another month,” said Bill Snowden, a shoe distributor from Bellevue, Wash., and the senior vice president of Topline Corp., which employs 100 people.
The shoe tax, which dates to the 1930s, originally was aimed at protecting a manufacturing sector that’s all but disappeared in the United States, according to the American Apparel & Footwear Association, a national trade organization. Over the last two decades, nearly all shoe production has moved outside the country.
The group said that 99 percent of the shoes bought in the United States last year were produced internationally, making it virtually impossible for Americans to avoid the tax.
Shoe industry officials say their business has hard-nosed competition that’s kept retail prices from rising much since 1999, but inflationary pressures are mounting.
Kevin Burke, the president and chief executive officer of the American Apparel & Footwear Association, said Americans “are about to face the first increase” in footwear prices in more than a decade. He said that quick passage of the bill would help alleviate those rising costs.
Supporters of the legislation say it has the potential to save American consumers billions of dollars. They say the tax particularly hurts the poor, who spend a larger share of their income on basic necessities such as shoes and clothing.
“Reducing tariffs on shoes helps working families afford something we all need to buy,” Murray said.
Cantwell said the bill would cut shoe costs for families “at a time when they most need it.”
While tariffs on different shoes vary, they might result in a $15 pair of shoes selling for as much as $25, Snowden said.
In past years, Snowden said, it’s been difficult to get members of Congress to focus on shoes, given their preoccupation with war, the economy and other big issues of the day.
Even though the legislation has stalled, Snowden said it had won support from many Democrats and Republicans in both houses of Congress.
“There have been so many other major, major pressing issues … that it gets bypassed, unfortunately,” he said.
Cantwell said that could happen again this year.
“It’s hard to say right now, with everything going on. … We’re in these big budget discussions, and I could see where it would get squeezed out,” she said.
But there may be an opening.
Whenever Congress takes up trade issues again, Cantwell said, “it would be a place to bring this up.”
No dates have been set, but the Senate could vote this year on trade pacts with South Korea, Colombia and Panama.