A federal panel in China released its expanded annual report to Congress on Tuesday, recommending for the first time that lawmakers end China’s favored trade status and end the provision that allows goods under $800 to enter the U.S. duty-free.

The US-China Economic and Security Review Commission, established by Congress as a bipartisan entity to investigate and provide policy recommendations on China, now advocates directly for Congress to end the permanent normal trade relations (PNTR) that China has enjoyed since 2004.

The committee will present the 83 policy recommendations to parliamentarians on Tuesday, along with a report on military capabilities, its threats to US allies in the region and how it exploits US policy for its own advancement.

“For decades we have engaged in ‘smack the mole’ policy, working within international organizations and guidelines to address China’s growing and ambitious efforts to circumvent laws or take advantage of trade loopholes,” he said. committee chair Robin Cleveland.

“In our hearing on threats to American consumers this year, we heard from the administration and expert witnesses who were clear: U.S. agencies don’t know whether most packages coming from China include a children’s toy painted with a toxic chemical — a counterfeit piece. of clothing made with slave labor – or an amount of fentanyl that is enough to kill the average citizen.”

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China’s security commission released its expanded annual report to Congress on Tuesday, recommending for the first time that lawmakers end China’s favored trade status. (Costfoto/NurPhoto via Getty Images)

“While the administration has existing authority to stem this tide of troubling products, we have a strong recommendation for legislative action that should strengthen safety and legal protections for consumers and manufacturers.”

The commission also identified an urgent need to advance artificial intelligence in the US, calling on Congress to establish and fund a “Manhattan Project-like program” to acquire artificial general intelligence (AG) capability, defined as systems that “would surpass the keenest human minds.” at every task”.

The the prospect of eliminating PNTR, which allowed cut-price Chinese goods to flood US markets throughout the 2000s, giving the CCP the same trade benefits as US allies, faces increasingly likely odds with Republican control of the House and Senate.

Removing it would give the president the authority to evaluate and review whether higher rates are needed. President-elect Donald Trump has promised to sharply raise tariffs on goods made in China.

The report found that Chinese goods are increasingly evading regulatory inspection and tariffs by coming in shipments worth less than $800, taking advantage of the “de minimus” exemption from the tariff law.

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Eliminating the “de minimus” for e-commerce shipments would require Customs and Border Patrol to institute much greater oversight of low-dollar shipments, prompting a call for more resources in Congress. But the report found that these shipments are often used to bring fentanyl into the US

The U.S. brought in about $4 million in de minimus-delivered Chinese goods a day this year, up from $3 million last year.

US President Joe Biden waves as he walks with Chinese President Xi Jinping at the Filoli estate on the sidelines of the APEC summit. (REUTERS/Kevin Lamarque//File photo)

Congress should also consider legislation to eliminate the federal tax burden on investments in Chinese companies that are on Department of Commerce trading blacklist known as the Entity List, according to the report.

Such legislation could eliminate the preferential capital gains tax rate, carried interest loophole, or capital loss carryforward provisions for companies believed to be infringing US interests or suspected of stealing intellectual property.

The report also recommended that the US strengthen its export controls to deny China access to critical dual-use goods and technologies and to ban imports of certain technologies controlled by Chinese entities, such as autonomous humanoid robots and infrastructure products energetic.

It urged Congress to direct the administration to create an overseas investment office to oversee dollars flowing to investments in countries of interest and to amend laws to give the Consumer Product Safety Commission binding authority to recall Chinese products.

The seized meth had an estimated street value of millions of dollars, CBP said. (US Customs and Border Protection)

Over the year, China has increasingly tried to crack down on dissent and “sanctions-proof” its economy in preparation for a future potential military or economic war with the West, the report said. It led violent attacks on Philippine personnel operating in its own exclusive zone, attempted to influence Taiwan’s democratic elections, and invaded Taiwanese airspace more than 2,300 times.

It launched its first intercontinental ballistic missile test in the South Pacific in more than 40 years.

Trump has he began to complete his Cabinet with the falcons of China. On the campaign trail this year, Trump proposed a 10 percent tariff on all U.S. imports and a 60 percent tariff on products made in China.

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If Trump successfully raises tariffs to 60 percent, it could cut China’s exports by $200 billion and cause a one percentage point cut in GDP, said Zhu Baoliang, former chief economist at the economic planning agency. of China at a Citigroup conference.

Last year, China exported about $500 billion worth of goods to the US, about 15 percent of all its exports.