S-3943-119
Read twice and referred to the Committee on Finance.
Sponsored by Jacky Rosen (D-NV)
What it does
This bill would require the Secretary of Commerce to create a process letting U.S. companies and trade associations request exclusions from tariffs (above January 19, 2025 levels) on materials used to build or furnish homes. Certain products listed in the bill would be automatically excluded, while other exclusion requests would be decided using a cost-of-construction test tied to Bureau of Labor Statistics data, with 15- or 60-day deadlines and retroactive refunds for duties paid before an exclusion was granted.
Who benefits
Homebuilders and construction companies that import lumber, cement, tile, glass, plumbing and electrical fixtures, and similar materials; prospective homebuyers and renters who may see lower construction costs passed through; importers and distributors of building materials; trade associations representing the homebuilding industry.
Who is hurt
Domestic manufacturers of competing building materials (such as U.S. lumber, cement, and glass producers) who could face increased import competition if tariff protections are reduced; the U.S. Treasury, which would collect less tariff revenue and would issue retroactive refunds; workers in protected domestic materials industries who could face reduced demand; and industries that rely on the tariffs this bill exempts as a policy tool (e.g., trade negotiators using tariffs as leverage).
Supporters argue
Supporters argue the United States faces a housing shortage of 3 to 5 million units and that tariffs on essential building materials—from lumber to fixtures—add billions of dollars to construction costs, directly worsening housing affordability for millions of families. They contend a fast, transparent exclusion process with firm deadlines (15 or 60 days) would let builders access needed materials at lower cost quickly, without requiring Congress to renegotiate broader trade policy.
Opponents argue
Opponents argue that carving out housing materials from tariffs undermines the policy rationale behind those tariffs, whether protecting domestic manufacturers, national security supply chains, or leverage in trade negotiations, and that retroactive refunds could impose unpredictable costs on the Treasury. They contend that a broad, open-ended exclusion process risks becoming a loophole exploited well beyond its intended scope, and that Congress rather than an executive agency should weigh tariff and trade tradeoffs directly.
Constitutional context
Congress holds the power to regulate foreign commerce and lay duties under Article I, Section 8, and this bill is itself an exercise of that power directing the executive branch to implement a specific exclusion process, similar to authority Congress has delegated in past tariff exclusion programs (e.g., Section 301 exclusions). No landmark case directly governs this narrow delegation, though nondelegation and major-questions principles from cases like West Virginia v. EPA (2022) could inform how much discretion Congress may give the Secretary of Commerce.
Checks and balances
Congress directs and constrains the Secretary of Commerce's tariff-exclusion authority through statutory deadlines, reporting requirements, and defined criteria, while retaining oversight via mandatory quarterly reports to the Senate Finance and House Ways and Means Committees.
Historical precedent
Similar exclusion processes were used under Section 301 tariffs on Chinese goods beginning in 2018, where companies could request product-specific exemptions from the U.S. Trade Representative.