An unprecedented $2.2 trillion US economic rescue package has been welcomed by groups representing apparel and footwear brands and importers – who are also urging for further action in the form of tariff relief.
The CARES (Coronavirus Aid, Relief, and Economic Security) Act was signed into law today (27 March) by President Trump. The legislation provides $2 trillion in aid, and incorporates a combination of loans, modifications to unemployment insurance measures, tax deferrals, and rebate checks.
“For the past few weeks, our members have been laser-focused on ensuring the health and safety of their workers and customers,” says Steve Lamar, president and CEO of the American Apparel & Footwear Association (AAFA).
“This is an unprecedented health crisis that has quickly become an unprecedented economic crisis. We are playing our part by having closed many of our facilities and, in some cases, converting production in the US and abroad over to the manufacture and distribution of face masks, gowns, and other personal protective equipment.
“But in the short term, the revenue stream for many of our members and their supply chains has dried up. This legislation will inject liquidity into the system allowing companies to sustain operations, and keep employees on the payroll so they start up quickly once health authorities give us the all clear.
Lamar also reiterated calls for immediate action on tariff relief.
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By GlobalData“Over the past 18 months, the US has collected approximately $50bn in punitive tariffs on textiles, apparel, footwear, travel goods, and many other inputs and finished items.
“These funds can quickly be released – using existing mechanisms and without further Congressional authorisation – to companies who need them to survive.
“Moreover, just like we have come together in a bipartisan manner to delay income tax payments, we need to do the same regarding upcoming tariff payments. Temporarily deferring these future payments is critical to help companies preserve cash so they can survive this crisis.”
