There has been much buzz in the Outdoor Industry the past few days over the Bill titled "US Optimal Use of Trade to Develop Outerwear and Outdoor Recreation Act" (US Outdoor Act) being introduced to Congress.
The Bill is basically proposing to eliminate import duty rates, which can be as high as 28.2%, on recreational performance apparel. The claim is that the elimination of duties will benefit the entire value chain of the Outdoor Industry.
The section of the Bill that really interests me is the creation of the Sustainable Textile and Apparel Research Fund (STAR Fund). The Secretary of Treasury shall collect a fee of 1.5% of the value of the goods imported and deposit it into the STAR Fund.
The funds in turn will be applied towards research, development, and education activities to enhance the competitiveness of businesses in the US in clean, eco-friendly apparel, other textile and apparel articles, and sewn-product design and manufacturing.
In order to receive funds, a company must be a retailer or a producer of fiber, yarn, fabric or apparel and have 10 years experience in R&D and education. The 10 year experience caveat is a bit unfortunate I think. The STAR Fund, instead of promoting innovating new companies and therefore a competitive US business environment, will simply look to fund programs in established companies, something ideally I hope they would be doing themselves. Dropping a 28.2% tariff, collecting a meager 1.5% in its place, and letting a company apply to receive it right back seems a bit senseless.
I would love to see that money go to creating an entire ecosystem in the US around eco-friendly textiles, apparel and manufacturing. This means helping grow newer and smaller companies in the industry- not just those who are major importers and have been around for 10 years.
Thoughts?