Lakshmikumaran & Sridharan 律师事务所An ISO 9001 / 27001 certified law firm

Differential tariff is not discriminatory

7th April, 2012

A long running debate fell short by a step yet again, as Rack Room Shoes could not prove gender discrimination by the US Government in fixing different classification / tariffs for men’s shoes and shoes for women and children. The Court of Appeal for the Federal Circuit (CAFC) recently reiterated the decision of the Court of International Trade (CIT) and held that merely because different tariffs were imposed and the schedule contained a gender based description there was no violation of the Equal Protection Clause of the U.S. Constitution.
Earlier, the CIT in its order dated 15-2-2012 had held that the government had a right to impose taxes which may affect different users of a product differently.  The US government said that tariffs were determined based on trade negotiations, commercial motivations or need of protecting domestic markets and the plaintiffs could not challenge the tariff under the ‘political question doctrine’. In other words the court was not the right forum to decide the issue. However, the Court found that there was no factual evidence of any intent to discriminate on part of the government nor had any section of users been proved to be actually disadvantaged due to high burden of taxes being passed on to them.

The plaintiffs also advanced the argument that the government had other means to raise revenue but it chose to discriminate based on gender. The court did not find force in any of these arguments. Differential tariffs have been a major battling point for importers. In an earlier case [Totes-Isotoner Corp. v. United States] the importers had protested against lower tariff for women’s gloves as compared to men’s gloves.   

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